RDP 9812: An Optimising Model for Monetary Policy Analysis: Can Habit Formation Help?
Equation (B2)
a
1
(
C
t
−
C
0
)
+
a
2
P
t
−
a
3
(
Z
t
−
C
0
)
+
k
0
=
E
t
[
(
1
+
r
¯
)
β
(
a
1
(
C
t
+
1
−
C
0
)
+
a
2
P
t
+
1
−
a
3
(
Z
t
+
1
−
C
0
)
)
−
δ
(
1
+
r
t
+
1
)
]
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