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This paper presents a welfare analysis of several capital insurance programs in a rational expectation equilibrium setting. We first explicitly characterize the equilibrium of each capital insurance program. Then, we demonstrate that a capital insurance program based on aggregate loss is better...
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itself. This description of entrepreneurship echoes Weber’s (1958 ) description of the “spirit of capitalism,” which states … implications of the spirit of capitalism on monetary policy, growth, and welfare in a Schumpeterian growth model. Different from … the spirit of capitalism is strong. Furthermore, we show the optimal nominal interest rate decreases with the strength of …
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