Existence, Stability and Computation of Stationary Distributions: An Extension of the Hopenhayn-Prescott Theorem

Takashi Kamihigashi and John Stachurski ()

No DP2011-32, Discussion Paper Series from Research Institute for Economics & Business Administration, Kobe University

Abstract: This paper strengthens the Hopenhayn and Prescott stability theorem for monotone economies. We extend the theorem to a larger class of applications, and develop new perspectives on the nature and causes of stability and instability. In addition, we show that models satisfying the Hopenhayn-Prescott theorem are ergodic, in the sense that sample averages of time series converge with probability one to their corresponding expectations under the stationary distribution, independent of initial conditions.

Pages: 42 pages
Date: 2011-12
New Economics Papers: this item is included in nep-dge
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Citations: View citations in EconPapers (9)

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