IMF research finds new method to model asset prices
A paper published by the IMF on Monday suggests a way to incorporate asset prices into real business cycle models.
Aytek Malkhozov and Shamloo Maral, the paper's authors, create a standard real business cycle model to compute logarithmic linearised dynamics and risk adjustments that accurately characterise asset pricing and welfare implications.
Malkhozov and Maral argue their method of doing so makes it easy to describe the time-series properties of the variables of interest and carry out
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