This paper presents a method to construct a sequence of approximate policy functions of increasing accuracy on non-local domains. The method is based upon the notion of stable manifold originated from dynamical systems theory. The approximate policy functions are constructed employing the...

We develop an alternative novel method of introducing real wage rigidity into an otherwise standard search and matching model. Wages are constantly renegotiated through Nash wage bargaining, however negotiations are based on imperfect information regarding the productivity level and consequently...

A constructive and recursion theoretic analysis of the standard Computable General Equilibrium (CGE) model of economic theory is undertaken. It is shown, contrary to widely expressed views and textbook versions of the CGE model, that the standard CGE model is neither computable nor constructive...

In this paper, we develop a framework for the formulation, analysis, and computation of solutions to spatial network problems in which the firms are multicriteria decision-makers and the consumers are as well. In particular, the firms, which are involved in the production of a homogeneous...

In this paper we examine the likelihood of multiple real steady states in deterministic exchange economies with overlapping generations. There is a single good and a single agent per generation with constant relative risk aversion expected utility. In order to test for multiple equilibria we...

In this paper we argue that in realistically calibrated two period general equilibrium models with incomplete markets CAPM-pricing provides a good benchmark for equilibrium prices even when agents are not mean-variance optimizers and returns are not normally distributed. We numerically...

The general equilibrium model with incomplete asset markets provides a unified framework for many problems in finance and macroeconomics. In its simplest version with only two time periods and a single physical commodity the model is ideally suited for the study of problems in cross sectional...

This paper presents a new numerical algorithm for solving Sylvester equation involved in higher order perturbation method used for solution of stochastic dynamic general equilibrium models. The new algorithm is better than methods used so far (esp. very popular doubling algorithm) in terms of...