A widely used utility function in the economics literature is the constant rate of risk aversion utility function, of which log utility is a special case. It is given by . With this utility function, the marginal utility of consumption is c ^-$\gamma$ . What is the Euler equation for this utility function? Show that if , the Euler equation is the same as if we used log utility.

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The Answer of A widely used utility function in the economics literature is the constant rate of risk aversion utility function, of which log utility is a special case. It is given by . With this utility function, the marginal utility of consumption is c ^-$\gamma$ . What is the Euler equation for this utility function? Show that if , the Euler equation is the same as if we used log utility.

A Widely Used Utility Function in the Economics Literature Is γ\gammaγ

A Widely Used Utility Function in the Economics Literature Is $\gamma$