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- W3123752018 abstract "Abstract This study proposes an approach based on a perturbation technique to construct global solutions to dynamic stochastic general equilibrium models (DSGE). The main idea is to expand a solution in a series of powers of a small parameter scaling the uncertainty in the economy around a solution to the deterministic model, i.e. the model where the volatility of the shocks vanishes. If a deterministic path is global in state variables, then so are the constructed solutions to the stochastic model, whereas these solutions are local in the scaling parameter. Under the assumption that a deterministic path is already known the higher order terms in the expansion are obtained recursively by solving linear rational expectations models with time-varying parameters. The present work also proposes a method rested on backward recursion for solving general systems of linear rational expectations models with time-varying parameters and determines the conditions under which the solutions of the method exist." @default.
- W3123752018 created "2021-02-01" @default.
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- W3123752018 date "2017-01-01" @default.
- W3123752018 modified "2023-09-27" @default.
- W3123752018 title "Semi-global solutions to DSGE models: perturbation around a deterministic path" @default.
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- W3123752018 doi "https://doi.org/10.1515/snde-2016-0065" @default.
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