Three methods have been developed by the authors for solving optimal experimentation problems. David Kendrick (1981, 2002, Ch.10) uses quadratic approximation of the value function and linear approximation of the equation of motion to simulate general optimal experimentation (active learning)...

In an earlier paper, i.e. Kendrick and Amman (A Taylor Rule for fiscal policy?, <CitationRef CitationID="CR9">2010</CitationRef>), we raised the question of whether adjusting fiscal policy more frequently than its current pace of once a year could be used to improve stabilization. Also, we proposed a method for shedding light on that...</citationref>

Two lines of literature show that increased uncertainty results in decreased vigor of the control variable in the first time period. The first line uses static models, the second dynamic. Here, the dynamic line is extended from one-state, one-control models to ones with two control variables. We...

Book review