A common set of mathematical tools underlies dynamic optimization, dynamic estimation, and filtering. In Recursive …

it is due to greater uncertainty faced by agents. Applying the methodology of Cunha, Heckman, and Navarro (2005) to data … predictable and unpredictable components of earnings have increased in recent years. The increase in uncertainty is substantially … greater for unskilled workers. For less skilled workers, roughly 60% of the increase in wage variability is due to uncertainty …

earnings variability are due to uncertainty and which components are due to components of human diversity that are forecastable …

The standard theory of decision making under uncertainty advises the decision maker to form a statistical model linking …