Output
Nominal Interest Rate
Consumption (Aggregate)
-1 —,-------,-------,-------,-------
2 4 6 8 10
Real Wage
-5
2 4 6 8 10
Consumption (Ricardian Households) Relative Price (I/F)
0
0∣—■--------■--------■--------■--------
-0.2
-0^r≤≤
2 4 6 8 10
Figure 8: Estimated Impulse Responses to a Risk Premium Shock
51
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