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Limited participation and International Risk-Sharing

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  • Nicolas Coeurdacier

    (SciencesPo and CEPR)

Abstract

The ”consumption real exchange rate anomaly” is one of the most subborn puzzle in open economy macroeconomics. We make substantial progress by introducing limited participation in an otherwise standard model. In particular, one of our methodological contribution is to show how we can solve for the characteristics and the dynamics of optimal portfolios in such a setup.

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Bibliographic Info

Paper provided by Society for Economic Dynamics in its series 2011 Meeting Papers with number 613.

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Date of creation: 2011
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Handle: RePEc:red:sed011:613

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Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
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Web page: http://www.EconomicDynamics.org/society.htm
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