This paper presents a fairly general treatment of recursive infinite horizon forward looking optimizing systems on infinite dimensional spatial domains. It includes optimal control, an analysis of local stability of spatially flat optimal steady states and development of techniques to compute...

In this paper, we apply first and higher-order Euler discretizations to compare dynamic systems in discrete and continuous time. In addition, we stress the difference between backward and forward-looking approximations. Focussing on local bifurcations, we find that time representation is neutral...

Innovation is the building block of competitive advantages and thus economic policies are increasingly focused on creating stimulus to increase a country’s innovative performance and growth potential, namely through knowledge accumulation in general and R&D in particular. In this context,...

Researchers have incorporated labor or credit market frictions in isolation within simple neoclassical models to open up a role for institutions, inject realism into their models and examine the impact of these distortions on output and employment. We present an overlapping generations model...

It is common to study the asymptotic properties of log-linear stochastic systems by analyzing the behaviour of their linear counterparts. In this paper a formal justification for analysis by log-linearization is given. As an application, a new existence, uniqueness and stability condition is...

This paper presents a fairly general treatment of recursive infinite horizon forward looking optimizing systems on infinite dimensional spatial domains. It includes optimal control, an analysis of local stability of spatially flat optimal steady states and development of techniques to compute...

This paper constructs a growth model in which monopolistically competing firms choose the characteristic of their own product from an unbounded product space. While consumers wish to satisfy various needs by purchasing a diverse range of goods, production costs are lower for those goods that are...

In this paper, we analyze government budget balance within a simple model of endogenous growth. For the AK model, simple analytical conditions for a tax cut to be self-financing can be derived. The critical variable is not the tax rate per se, but the "transfer-adjusted tax rate". We discuss...

This paper presents an endogenous growth model where it is endogenously determined whether entrepreneurs in the poor East choose to innovate or to imitate goods from the rich West. It is shown that we have a unique equilibrium with imitation when trade is relatively expensive, in which case the...