EconPapers    
Economics at your fingertips  
 

Solution of continuous-time dynamic models with inequality constraints

Timo Trimborn ()

Economics Letters, 2013, vol. 119, issue 3, 299-301

Abstract: I propose a simple method to compute the transition process in continuous-time dynamic equilibrium models with occasionally binding inequality constraints. By augmenting the dynamic system with an auxiliary variable standard algorithms are able to solve the extended dynamic system taking the inequality into account. The procedure can handle any sequence of regimes with binding and non-binding constraints and determines the exact pattern of regimes endogenously.

Keywords: Inequality constraint; Continuous-time dynamic models; Transitional dynamics; Ramsey model (search for similar items in EconPapers)
JEL-codes: C61 C63 O40 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176513000876
Full text for ScienceDirect subscribers only

Related works:
Software Item: Matlab code for "Solution of continuous-time dynamic models with inequality constraints" (2013) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:119:y:2013:i:3:p:299-301

DOI: 10.1016/j.econlet.2013.02.026

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2020-02-15
Handle: RePEc:eee:ecolet:v:119:y:2013:i:3:p:299-301