Essays in Dynamic General Equilibrium by Dan Cao B.S., M.A., Ecole Polytechnique (2005) Submitted to the Department of Economics in partial fulfillment of the requirements for the.
I introduce a dynamic general equilibrium model with aggregate shocks, potentially incomplete markets and heterogeneous agents to investigate this role of financial markets. In addition to their risk aversion and endowments, agents differ in their beliefs about the future aggregate states of the economy.
This collection of essays honors David Cass on the 30 th anniversary of his joining the faculty of the Department of Economics at the University of Pennsylvania. Prof. Cass’s work has spawned a number of important lines of research in Economics, including the study of dynamic general equilibrium, the concept of sunspot equilibria, and general equilibrium theory when markets are incomplete.The methods of microeconomics, general equilibrium theory, control theory, dynamic programming, statistical decision theory, and game theory have been adopted by macroeconomists and adapted to address questions that involve market interactions among ratio-nal, forward-looking agents, in dynamic settings that experience stochastic shocks. No longer.A Simple Dynamic Applied General Equilibrium Model of a Small Open Economy: 79 for capital assets in the world financial capital market. There are two production sectors, agriculture (A) and non-agriculture (N), employing two primary inputs, labor (L) and capital (K).
In chemistry, and in physics, a dynamic equilibrium exists once a reversible reaction occurs. Substances transition between the reactants and products at equal rates, meaning there is no net change. Reactants and products are formed at such a rate that the concentration of neither changes.
Modern business cycle theory and growth theory uses stochastic dynamic general equilibrium models. In order to solve these models, economists need to use many mathematical tools. This book presents various methods in order to compute the dynamics of general equilibrium models. In part I, the.
Dynamic equilibrium is an important concept of chemistry.it is important to understand how can something be dynamic and at equilibrium at the same time. What is a dynamic equilibrium? Chemical reactions can either go in one direction or both directions i.e. forward and reverse.
Essays on political economy using dynamic general equilibrium models.. The thesis aims to have four separate papers based on dynamic general equilibrium (DGE) models: The first paper would aim to explain theoretically why tax evasion might depend on the level of financial development and the inflation rate in the economy.
General equilibrium theory, or Walrasian general equilibrium, attempts to explain the functioning of economic markets as a whole, rather than as individual phenomena. The theory was developed by.
General equilibrium theory is presented by Mas-Colell, Whinston and Green in two rather different ways. One is entirely abstractly, as relating to the idea that “we must simultaneously determine the equilibrium values of all variables of interest” (MWG, p.511).
The Law of Mass Action states that when a system (e.g., chemical reaction) is at equilibrium, the ratio of products and reactant concentrations is equal to the equilibrium constant for that reaction.If we change the concentration of any species (e.g., by adding reactant to the mixture), then the reaction will shift toward reactants or products in order to restore the ratio of concentrations to.
Dynamic Equilibrium. In a reversible reaction as the products are used up the forward reaction slows and as more product is formed the reverse reaction speeds up. After a while the forward and reverse reactions will occur at the same rate. The amount of reactants and products won't be changing.
In dynamic equilibrium models, individual behavior is typically determined by the optimal solution of some (dynamic) optimization problem an agent with rational expectations faces. Quite differently, in agent-based macroeconomic models it is not assumed that the economy is in equilibrium and that individuals have rational expectations.
ESSAYS ON PUBLIC FINANCE AND ECONOMIC GROWTH USING DYNAMIC GENERAL EQUILIBRIUM MODELS Emmanuel Ziramba, Ph.D. University of Pretoria, 2008 ABSTRACT This thesis comprises of six independent chapters, besides the introduction and conclu-sions, with the common theme of optimal public policies in dynamic general equilibrium.
General Equilibrium Theory: Examples. 3 examples of GE: I pure exchange (Edgeworth box) I 1 producer - 1 consumer I several producers and an example illustrating the limits of the partial equilibrium approach. First example: Edgeworth Box A pure exchange economy (no production possibilities).