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[olg] update on Euler EQ and Log #503

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Jul 4, 2024
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[olg] update on Euler EQ and Log #503

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4 changes: 2 additions & 2 deletions lectures/olg.md
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Expand Up @@ -155,7 +155,7 @@ The first-order condition for a maximum can be obtained
by plugging $c_{t+1}$ into the objective function, taking the derivative
with respect to $c_t$, and setting it to zero.

This leads to the **Euler equation** of the OLG model, which is
This leads to the **Euler equation** of the OLG model, which describes the optimal intertemporal consumption dynamics:

```{math}
:label: euler_1_olg
Expand Down Expand Up @@ -539,7 +539,7 @@ The interest rate reflects the marginal product of capital, which is high when c

Previously, in our examples, we looked at the case of log utility.

Log utility is a rather special case.
Log utility is a rather special case of CRRA utility with $\gamma \to 1$.

In this section, we are going to assume that $u(c) = \frac{ c^{1-
\gamma}-1}{1-\gamma}$, where $\gamma >0, \gamma\neq 1$.
Expand Down