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- W2750843808 abstract "Abstract This paper analyzes the problem of computing the social optimum in models with heterogeneous agents subject to idiosyncratic shocks. This is equivalent to a deterministic optimal control problem in which the state variable is the infinite-dimensional cross-sectional distribution. We show how, in continuous time, the problem can be broken down into two finite -dimensional partial differential equations: a dynamic programming equation and the law of motion of the distribution, and we introduce a new numerical algorithm to solve it. We illustrate this methodology with two examples: social optima in an Aiyagari economy with stochastic lifetimes and in a model of on-the-job search with learning." @default.
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- W2750843808 date "2018-04-01" @default.
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- W2750843808 title "Social optima in economies with heterogeneous agents" @default.
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- W2750843808 doi "https://doi.org/10.1016/j.red.2017.08.003" @default.
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