41 lines
1.1 KiB
Modula-2
41 lines
1.1 KiB
Modula-2
/* Example that triggers homotopy in perfect foresight simulation with
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expectation errors, and tests marginal linearization. */
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var Consumption, Capital, LoggedProductivity;
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varexo LoggedProductivityInnovation;
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parameters beta, alpha, delta, rho;
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beta = .985;
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alpha = 1/3;
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delta = alpha/10;
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rho = .9;
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model;
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1/Consumption = beta/Consumption(1)*(alpha*exp(LoggedProductivity(1))*Capital^(alpha-1)+1-delta);
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Capital = exp(LoggedProductivity)*Capital(-1)^alpha+(1-delta)*Capital(-1)-Consumption;
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LoggedProductivity = rho*LoggedProductivity(-1)+LoggedProductivityInnovation;
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end;
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initval;
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LoggedProductivityInnovation = 0;
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end;
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steady;
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endval;
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LoggedProductivityInnovation = 0.6;
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end;
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endval(learnt_in = 5);
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LoggedProductivityInnovation = 1;
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end;
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perfect_foresight_with_expectation_errors_setup(periods=200);
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perfect_foresight_with_expectation_errors_solver(homotopy_max_completion_share = 0.8, homotopy_marginal_linearization_fallback, steady_solve_algo = 13);
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if ~oo_.deterministic_simulation.status
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error('Perfect foresight simulation failed')
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end
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