Using asterisks to describe HG-10-102-01 price and market tightness of the market in which the household shops, we can write the recursive problem of the household asequation(2.4)V(i,y,a)=maxa′,c,s,d,p?,q?,t?u(c,s,d)+β∑i′Πi,i′∫V(i′,y′(i′,η′),a′)F(dη′ i′) subject toequation(2.5)p?s+c+a′≥(1+r)a+ζys+yc,p?s+c+a′≥(1+r)a+ζys+yc,equation(2.6)s=dΨd(q?),s=dΨd(q?),equation(2.7)ζ≤p?Ψf(q?),ζ≤p?Ψf(q?),equation(2.8)a′≥a?,equation(2.9)ys≥∫B(ζ)t(dp,dq), where y′(i′,η′)= κysi′(1+η′),ysi′(1+η′) . The household\'s budget constraint is (2.5). The search friction requires that services must be found, which is constraint (2.6). To guarantee that locations are sent to market (p?,q?)(p?,q?), condition (2.7) has to hold. Condition (2.8) is an ad hoc borrowing limit that the financial shocks will hit. Finally, condition (2.9) makes interneurons explicit that the household allocates its measure of locations to active markets, where t is the measure of households\' active locations over various markets (a measure over B2B2). Even though households are indifferent toward sending their locations to different markets, we pose the condition here because it sharpens the definition of equilibrium.
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