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Ramsey Optimal Policy Algorithm.pdf

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Preview of Ramsey Optimal Policy Algorithm
🔗 Source: mpra.ub.uni-muenchen.de
📊 Size: 193 KB
📄 Pages: 13 pages
⬇️ Downloads: 141

Summary

This article presents an algorithm for solving Ramsey optimal policy with exogenous forcing variables in dynamic stochastic general equilibrium models. It extends Ljungqvist and Sargent's dynamic Stackelberg game and computes the optimal initial anchor of "jump" variables, such as inflation. The algorithm enables the computation of a history-dependent representation of a Ramsey policy rule that can be implemented by policymakers and estimated within a vector auto-regressive model, without requiring non-observable Lagrange multipliers.

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Description

This article presents an algorithm for solving Ramsey optimal policy with exogenous forcing variables in dynamic stochastic general equilibrium models.

Technical Information

  • File Format: PDF
  • File Size: 193 KB
  • Pages: 13
  • Language: EN
  • Total Downloads: 141
  • Last Updated: 4 weeks ago

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