The global food price shock of 2006-2008 has particularly affected poorer strata of populations in several developing countries. In Egypt and some other countries it has put food subsidy schemes to the test. This paper develops two comparable computable general equilibrium models for Egypt and...

I consider a real business cycle model in which agents have private information about an idiosyncratic shock to their value of leisure. I consider the mechanism design problem for this economy and describe a computational method to solve it. This is an important contribution of the paper since...

This paper presents the new dynamic spatial general equilibrium (DSGE) model – RHOMOLO, which is built to support the EU policy design by undertaking holistic, micro-founded and disaggregated policy impact assessment. The RHOMOLO model is based on the theories of general equilibrium,...

This paper compares different solution methods for computing the equilibrium of dynamic stochastic general equilibrium (DSGE) models with rare disasters along the lines of those proposed by Rietz (1988), Barro (2006), Gabaix (2012), and Gourio (2012). DSGE models with rare disasters require...

We consider a class of infinite-horizon dynamic Markov economic models in which the parameters of utility function, production function, and transition equations change over time. In such models, the optimal value and decision functions are time-inhomogeneous: they depend not only on state but...

Unlike linear ones, nonlinear business cycle models can generate sustained fluctuations even in the absence of shocks (e.g., via limit cycles/chaos). A popular approach to solving nonlinear models is perturbation methods. I show that, as typically implemented, these methods are incapable of...

We establish 16 good practice principles for modelling defined contribution pension plans. These principles cover the following issues: model specification and calibration; modelling quantifiable uncertainty; modelling member choices; modelling member characteristics, such as occupation and...

This paper develops a dynamic general equilibrium model with heterogeneous firms that face search complementarities in the formation of vendor contracts. Search complementarities amplify small differences in productivity among firms. Market concentration fosters monopsony power in the labor...

Computational methods both open the frontiers of economic analysis and serve as a bottleneck in what can be achieved. Using the quantum Monte Carlo (QMC) algorithm, we are the first to study whether quantum computing can improve the run time of economic applications and challenges in doing so....

Extreme natural hazards represent, together with crises and wars, the most disruptive phenomena for economic activity. Their economic impact has been shown to be remarkable, long-lasting, and growing over time, though the exact mechanisms at stake are challenging to isolate and quantify. As...