Monotone methods for Markovian equilibrium in dynamic economies

Manjira Datta; Leonard J. Mirman; Olivier F. Morand; Kevin L. Reffett

In this paper, we provide an overview of an emerging class of monotone map methods in analyzing distorted equilibrium in dynamic economies. In particular, we focus on proving the existence and characterization of competitive equilibrium in non-optimal versions of the optimal growth models. We suggest two alternative methods: an Euler equation method for a smooth, strongly concave environment, and a value function method for a non-smooth supermodular environment. We are able to extend this analysis to study models that allow for unbounded growth or a labor-leisure choice.

MoreLess

Year of publication:	2002
Authors:	Datta, Manjira ; Mirman, Leonard J. ; Morand, Olivier F. ; Reffett, Kevin L.
Publisher:	Rotterdam [u.a.] : Tinbergen Inst.
Subject:	Gleichgewichtstheorie \| Equilibrium theory \| Dynamisches Gleichgewicht \| Dynamic equilibrium \| Optimales Wachstum \| Optimal growth \| Markov-Kette \| Markov chain