This paper empirically investigates the ability of a real business-cycle model with nonseparabilities in consumption and leisure and external habits both in consumption and leisure to fit the postwar US data. The results indicate a strong but fast-dying habit in leisure, and a somewhat weaker...

This paper develops and estimates a dynamic model of stock market participation, where consumers' decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial...