The Volatility Trap is popular PDF and ePub book, written by Reda Cherif in 2012-05-01, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, The Volatility Trap can be Read Online from any device for your convenience.
The Volatility Trap Book PDF Summary
We study the effects of permanent and temporary income shocks on precautionary saving and investment in a "store-or-sow" model of growth. High volatility of permanent shocks results in high precautionary saving in the safe asset and low investment, or a "volatility trap." Namely, big savers invest relatively little. In contrast, low volatility of permanent shocks leads to low precautionary saving and high or low investment, depending on the volatility of temporary shocks. Empirical evidence shows a nonlinear relationship between investment and saving and that investment is a hump-shaped function of the volatility of permanent shocks, as predicted by the model.
Detail Book of The Volatility Trap PDF
- Author : Reda Cherif
- Release : 01 May 2012
- Publisher : International Monetary Fund
- ISBN : 9781475570694
- Genre : Business & Economics
- Total Page : 41 pages
- Language : English
- PDF File Size : 9,5 Mb
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