Solving the Discrete-Time Stochastic Ramsey Model
VU University Amsterdam - Faculty of Economics and Business Administration; Tinbergen Institute - Tinbergen Institute Amsterdam (TIA)
February 26, 2009
Tinbergen Institute Discussion Paper No. 09-018/2
This note describes methods for solving deterministic and stochastic versions of the discrete-time Ramsey model of economic growth. We derive an iterative procedure for solving the Euler equation and apply it to an example adapted from Pan (2007).
Number of Pages in PDF File: 15
Keywords: Ramsey model, Stochastic Ramsey model, Solution methods
JEL Classification: C61, E22, O41working papers series
Date posted: February 26, 2009
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