We develop a tractable way to solve for equilibrium quantities and asset prices in a class of real business cycle models featuring Epstein-Zin preferences and affine dynamics for productivity growth and volatility. The method relies on log-linearization and exploits the log-normality of all the...

We develop a tractable way to solve for equilibrium quantities and asset prices in a class of real business cycle models featuring Epstein-Zin preferences and affine dynamics for productivity growth and volatility. The method relies on log-linearization and exploits the log-normality of all the...

We describe a tractable way to jointly study macroeconomic quantities, welfare and asset prices in real business cycle models featuring affine structure of shocks and Epstein-Zin-Weil preferences. Our solution is analytical, log-linearized and adjusted for risk by exploiting log-normality....