A recursive method for solving a climate-economy model: value function iterations with logarithmic approximations

A recursive method for solving an integrated assessment model of climate and the economy is developed in this paper. The method approximates value function with a logarithmic basis function and searches for solutions on a set satisfying optimality conditions. These features make the method suitable for a highly nonlinear model with many state variables and various constraints, as usual in a climate-economy model.

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Year of publication:	2014-03-25
Authors:	Hwang, In Chang
Institutions:	Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München
Subject:	Dynamic programming \| recursive method \| value function iteration \| integrated assessment

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Extent:	application/pdf
Series:	MPRA Paper.
Type of publication:	Book / Working Paper
Classification:	C61 - Optimization Techniques; Programming Models; Dynamic Analysis ; C63 - Computational Techniques ; Q54 - Climate; Natural Disasters
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011113405