"Commodity futures risk premiums vary across commodities and over time depending on the level of physical inventories, as predicted by the Theory of Storage. Using a comprehensive dataset on 31 commodity futures and physical inventories between 1969 and 2006, we show that the convenience yield...

This notes outlines how to solve Hayashi and Prescott (2007) "The 1990s: Japan's Lost Decade", extended with an exogenous population growth and labour-augmenting technical progress, using a Linear-Quadratic Approximation as in Ljungqvist and Sargent (2004).