Dynamic Programming on a Quantum Annealer: Solving the RBC Model

Jesus Fernandez-Villaverde and Isaiah Hull

No 31326, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We introduce a novel approach to solving dynamic programming problems, such as those in many economic models, on a quantum annealer, a specialized device that performs combinatorial optimization. Quantum annealers attempt to solve an NP-hard problem by starting in a quantum superposition of all states and generating candidate global solutions in milliseconds, irrespective of problem size. Using existing quantum hardware, we achieve an order-of-magnitude speed-up in solving the real business cycle model over benchmarks in the literature. We also provide a detailed introduction to quantum annealing and discuss its potential use for more challenging economic problems.

JEL-codes: C63 C78 E37 (search for similar items in EconPapers)
Date: 2023-06
New Economics Papers: this item is included in nep-cmp and nep-dge
Note: EFG
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Related works:
Working Paper: Dynamic Programming on a Quantum Annealer: Solving the RBC Model (2023)
Working Paper: Dynamic Programming on a Quantum Annealer: Solving the RBC Model (2023)
Working Paper: Dynamic Programming on a Quantum Annealer: Solving the RBC Model (2023)
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