period.2.m: The Second Period Problem Given Decision to Stay Married

Description Usage Arguments

View source: R/period.2.m.R

Description

This function finds the optimal spouses' consumption levels in the second period given their decision to stay married. We can use the optimization procedure or just use the analytical solution. The default is to use the analytical solution and it is necessary to be worked in some other parts of the code.

Usage

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period.2.m(S, i, r1, r2, Analytical = TRUE,
  sigma_eta_h = param()$sigma_eta_h, rho = param()$rho, phi = param()$phi)

Arguments

S

Saving

i

The marriage index

r1

First period repetition. It is not necessary to be greater than one for the first period. It is needed for taking expectaions, which is required in the second period

r2

Second period repetition. It is needed for taking expectaions, which is required in the second period

Analytical

If it is on it uses the analytical solution instead of using the optimization procedure.

sigma_eta_h

The husband's variance of transitory shock. If not specified the default is the baseline value specified in the param()

rho

The contemporaneous correlation coefficient of the husband and wife income shocks. If not specified the default is the baseline value specified in the param()

phi

The ratio of the wife's standard deviation of the transitory shock to that of the husband. If not specified the default is the baseline value specified in the param()


mirtaher/TwoPeriodSim documentation built on May 22, 2019, 11:55 p.m.