We study an Agent-based model of household-bank relationships where households borrow for the purpose of consumption. Desired consumption is driven by households disposable income as well as a social norm of consumption. If households care about their relative position in the economy (i.e. want...

In this study, the household labour supply is modelled as a discrete choice problem assuming that preference for leisure and consumption can be described by a quadratic utility function which allows for non-convexities in the budget set. We assess behavioural responses to the significant changes...