RDP 2009-08: Leverage Constraints and the International Transmission of Shocks
Equation (5)
U
′
(
C
t
I
)
=
E
t
β
I
(
C
t
I
)
U
′
(
C
t
+
1
I
)
(
q
2
t
+
1
+
R
2
K
t
+
1
)
q
2
t
+
κ
μ
t
,
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