I study how boundedly rational agents can learn a “good” solution to an infinite horizon optimal consumption problem … under uncertainty and liquidity constraints. Using an empirically plausible theory of learning I propose a class of adaptive … learning algorithms that agents might use to choose a consumption rule. I show that the algorithm always has a globally …

two-period consumption and savings model for a loss-averse agent who measures utilityfrom consumption relative to a … of the return on saving. We find non-linearity in the fractionof wealth saved, where the specific saving pattern depends … on the sign of the real return on savings. The amount of saving is nondecreasing in initial wealth and the riskiness of …

This paper studies the consumption decisions of agents who face costs of acquiring, absorbing and processing … consumption plans. In between updating dates, they remain inattentive. This behavior implies that news disperses slowly throughout … the population, so events have a gradual and delayed effect on aggregate consumption. The model predicts that aggregate …

uncertainty into Integrated Assessment Models (IAMs). Uncertainty is transformed into a risk-premium, damage-correction, region …. This risk premium quantifies what society would be willing to pay to insure against the uncertainty of the damages, and it …