Lombardo, Giovanni; Uhlig, Harald - 2014
Often, numerical simulations for dynamic, stochastic models in economics are needed. Higher order methods can be …) proposed pruning to deal with this challenge for second order approximations. In this paper, we provide a theory of pruning and … formulas for pruning of any order. We relate it to results described by Judd (1998) on perturbing dynamical systems. …