We study the interaction of multiple large economies in dynamic stochastic general equilibrium. Each economy has a monetary policymaker that attempts to control the economy through the use of a linear nominal interest rate feedback rule. We show how the determinacy of worldwide equilibrium depends on the joint behavior of policymakers worldwide. We also show how indeterminacy exposes all econom...

We study the optimal control of general stochastic McKean-Vlasov equation. Such problem is motivated originally from the asymptotic formulation of cooperative equilibrium for a large population of particles (players) in mean-field interaction under common noise. Our first main result is to state a dynamic programming principle for the value function in the Wasserstein space of probability measu...

We adopt stochastic games as a general framework for dynamic noncooperative systems. This framework provides a way of describing the dynamic interactions of agents in terms of individuals' Markov decision processes. By studying this framework, we go beyond the common practice in the study of learning in games, which primarily focus on repeated games or extensive-form games. For stochastic games...

The use of foreign exchange intervention in an inflation-targeting framework raises the question regarding its role. In addition, environment volatile capital flows, how risk appetite investors might impact economy is worth exploring. This paper examines these issues for Indonesia by developing and estimating a dynamic stochastic general equilibrium model. study finds that affects macroeconomic ...

In the United States, inflation and output of durable nondurable goods respond to a monetary policy shock in same direction with delay. However, existing New Keynesian dynamic stochastic general equilibrium models that generate positive comovement cannot explain this delayed response sectoral inflation. We show adding sticky information both along heterogeneous factors production can observed p...

In this paper we summarize a dual-time scale formulation of dynamic user equilibrium with demand growth due to Friesz et al (2008). This formulation belongs to the problem class that Pang and Stewart (2008) refer to as di¤erential variational inequalities. We also present a …xed point algorithm for computing solutions to the dual time-scale model without calculating derivatives, along with a nu...

Frictions are introduced in the information structure of a cash-in-advance dynamic stochastic general equilibrium model with the interest of studying the impact of serially correlated monetary shocks on the variability of velocity. Possessing no analytical solution this dynamic environment, a projection method which parameterizes expectations and employs finite elements in the approximation of ...

We examine solutions in which neither player is worse off from the leadership of one in a policy maker-public game. The loop model of dynamic games is used. Outcome space is dotted with equivalence classes of solutions. The Dynamic Stochastic General Equilibrium (DSGE) results and their New Keynesian variants might represent one category. The economy is the neighborhood of a market-clearing equ...