This paper studies a discrete-time utility maximization problem of an infinitely-lived quasi-geometric consumer whose labor income is subject to uninsurable idiosyncratic productivity shocks. We restrict attention to a first-order Markov recursive solution. We show that under the assumption of...

Let µ be a rational distribution over a finite alphabet, and ( ) be a n-periodic sequences which first n elements are drawn i.i.d. according to µ. We consider automata of bounded size that input and output at stage t. We prove the existence of a constant C such that, whenever , with...

This paper extends the indivisible-labor model by Hansen (1985) and Rogerson (1988) to include multiple consumers who differ in initial wealth and whose labor productivities are subject to idiosyncratic shocks. In the presence of idiosyncratic uncertainty, the optimal allocations for the...

This paper studies how the assumption of quasi-geometric (quasi-hyperbolic) discounting affects the individual consumption-savings behavior in the context of the standard one-sector neoclassical growth model with heterogeneous agents. The agents are subject to idiosyncratic shocks and face...

This paper presents a model of network formation with costly links. We endogenize the amount of cost born by each player involved in a bilateral link by considering that these shares result from bargaining. We analyze this feature in a context of coordination games. We show that, if the cost of...

The paper proposes a theory of the wage arrears phenomenon in transition economies. We build on the standard one-sector neoclassical growth model. The neoclassical firms in transition make losses and use wage arrears as the survival strategy. At the agents' level, the randomness in the timing...

This paper presents a model in which players interact via the formation of costly links and the benefits of bilateral interactions are determined by a coordination game. A novel contribution of this paper is that the fraction of the cost borne by each player involved in a bilateral link is not...