This paper studies the effects of house price risk on the optimal asset and consumption choices of a finitely lived investor who derives utility from the consumption of both housing and other goods. Frictions considered in the model include transaction costs of selling a house, uninsurable labor...

Economic evolution is said to occur when economic structures change. That is, when the institutional and/or technological rules of a society are replaced by new ones. As with evolutionary phenomena in other fields it is rather impossible to predict such a change. The reason is that economic...

In this application of an overlapping generations model the effects of a pay-as-you-go retirement scheme on the optimal savings rate, magnitude and stability of the equilibrium capital per capita level are established through the assumptions of explicit, well-behaved utility and production...

In recent years, much attention and many papers have been devoted to general heuristics techniques, known as metaheuristics, that are applicable, in particular, to solve hard combinatorial optimization problems. There are a huge amount of combinatorial optimization problems in all sectors of...

Publicly managed social security agencies providing old-age insurance through intergenerational transfers face ever growing losses in many countries as the natural aging of population over time increases old-age dependency ratios. In addition to raises in old-age insurance premiums and/or...

Two fundamental sources of output growth are production capital and technological knowledge. We consider technological knowledge in the form of total-factor productivity (henceforth, "productivity") in a constant-elasticity-of-substitution (CES) production function. But capital and productivity...

Nonlinear modeling with neural networks offers a promising approach for studying the prediction of a chaotic time series. In this paper, we propose a stochastic neural net based on Extended Kalman Filter to examine the nonlinear dynamic proprieties of some financial time series in order to...

That there are foundational problems involved in simulation approaches to economics can hardly come as a surprise to the reader. Some of these problems are inherited from economics but are exposed anew when a simulation approach is chosen, and computability required. These are problems as...

In this paper we demonstrate that a standard loss function of a central bank may generate multiple equilibria which can contribute to hysteresis effects on the labor market. Multiple equilibria are feasible if the objective function of the central bank is non-quadratic. Such preferences may...

Macroeconomists pursuing microfoundations for aggregate consumption have generally adopted one of two approaches: either to model microeconomic consumption behavior carefully and then to aggregate, or to thoroughly understand the behavior of a `representative consumer' in general equilibrium,...