We describe an algorithm that is able to compute the solution of a singular linear difference system under rational expectations. The algorithm uses the Generalized Schur Factorization and is illustrated by a simple example. -- stochastic dynamic general equilibrium ; linear solution methods ;...

Part I: Representative Agent Models: Basic Models -- Perturbation Methods: Framework and Tools -- Perturbation Methods: Solutions -- Perturbation Methods: Model Evaluation and Applications -- Weighted Residuals Methods -- Simulation-Based Methods -- Discrete State Space Value Function Iteration...

Modern business cycle theory and growth theory uses stochastic dynamic general equilibrium models. Many mathematical tools are needed to solve these models. The book presents various methods for computing the dynamics of general equilibrium models. In part I, the representative-agent stochastic...