Showing 1 - 10 of 64
In this article, we propose a recursive equilibrium algorithm for the numerical simulation of nonoptimal dynamic economies. This algorithm builds upon a convergent operator over an expanded set of state variables. The fixed point of this operator defines the set of all Markovian equilibria. We...
Persistent link: https://www.econbiz.de/10011006338
In this paper we are concerned with the equilibrium dynamics of a two-sector model of endogenous growth with distortionary taxes. We show that for certain parameters values and tax schemes every equilibrium orbit--except the steady state solution--is non-interior; i.e., there are times in which...
Persistent link: https://www.econbiz.de/10005237151
In this paper we develop a discretized version of the dynamic programming algorithm and derive error bounds for the approximate value and policy functions. We show that under the proposed scheme the computed value function converges quadratically to the true value function and the computed...
Persistent link: https://www.econbiz.de/10005310391
In this paper we give an overview of the differentiability properties of the value and policy functions of dynamic programming. Based upon the differentiability analysis, we also establish approximation estimates for the value and policy functions of a discretized model amenable to the...
Persistent link: https://www.econbiz.de/10005310401
The principal aim of this article is to provide commentary on the use of high-performance computers combined with numerical algorithms in the investigation of mathematical models of economic activity. The use of computer simulation to provide insight into mathematical models is distinguished...
Persistent link: https://www.econbiz.de/10005310408
In this paper we analyze the rate of convergence to a balanced path in a class of endogenous growth models with physical and human capital. We show that such rate depends locally on the technological parameters of the model, but does not depend on those parameters related to preferences. These...
Persistent link: https://www.econbiz.de/10005310432
Recent research has focused on the dynamics of the Lucas-Uzawa model of endogenous growth (e.g., Caballé-Santos (1993), Chamley (1993) and Faig (1993)). This model allows for permanent growth of both consumption and investment, propelled by a human capital technology. In contrast to the...
Persistent link: https://www.econbiz.de/10005310436
This paper presents a methodology for the formulation and testing of economic growth models. The model selected includes two production sectors with physical and human capital accumulation. These capital stocks are associated with spillover effects in the production of the physical good and in...
Persistent link: https://www.econbiz.de/10005371300
In this paper we develop a discretized version of the dynamic programming algorithm and derive error bounds for the approximate value and policy functions. We show that under the proposed scheme the computed value function converges quadratically to the true value function and the computed...
Persistent link: https://www.econbiz.de/10005372806
Persistent link: https://www.econbiz.de/10005205103