Relate these to observed correlations from us data does the, Econometrics

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Relate these to observed correlations from us data does the

Extend the code for the one sector stochastic growth model to solve (5.34). Use the resulting policy functions to simulate the model, and compute moments as a function of key parameters, including the variance/covariance matrix for the shocks. Relate these to observed correlations from U.S. data. Does the existence of taste shocks ‘‘help'' the model fit the data better?

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