Computation of Equilibria in OLG Models with Many Heterogeneous Households
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چکیده
This paper develops a decomposition algorithm by which a market economy with many households may be solved through the computation of equilibria for a sequence of representative agent economies. The paper examines local and global convergence properties of the sequential recalibration (SR) algorithm. SR is then demonstrated to efficiently solve AuerbachKotlikoff OLG models with a large number of heterogeneous households. We approximate equilibria in OLG models by solving a sequence of related Ramsey optimal growth problems. This approach can provide improvements in both efficiency and robustness as compared with simultaneous solution methods.
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Ruhr Economic Papers Ruhr Economic Papers Ruhr Graduate School in Economics Computation of Equilibria in Olg Models with Many Heterogeneous Households
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تاریخ انتشار 2007