These notes provide an intuitive introduction to dynamic programming. The first two Sections, which can be skipped, present the standard deterministic Ramsey model using the Lagrangian approach. Section 3 reformulates the Ramsey problem by means of a Bellman equation, while Section 4 shows how...

Abstract We present a simple multiple equilibria model that incorporates the functioning of crony capitalism. We find that a government which is keen to support the interests of the élite is ready to stand the risk of a bank run since this is part of an equilibrium where investments are heavily...