We analyze a numerical scheme for solving the consumption and investment allocation problem studied in a companion paper by Hindy, Huang, and Zhu (1993). For this problem, Bellman's equation is a differential inequality involving second order partial differential equation with gradient...

We study a model of consumption choice and portfolio allocation that captures, in two different interpretations, the combined effect of local substitution and habit formation and the combined effect of durability of consumption goods and habit formation over service flows from those goods. In a...

We analyze a numerical scheme for solving the consumption and investment allocation problem studied in a companion paper by Hindy, Huang, and Zhu (1993). For this problem, Bellman's equation is a differential inequality involving second order partial differential equation with gradient...

We study a model of consumption choice and portfolio allocation that captures, in two different interpretations, the combined effect of local substitution and habit formation and the combined effect of durability of consumption goods and habit formation over service flows from those goods. In a...