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Steady state properties of multi-state economic models

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  • Yacov Tsur
  • Amos Zemel

Abstract

A simple method to derive optimal steady states of multi-state dynamic economic systems with minimal assumptions on the underlying processes is developed. This is accomplished by an n -dimensional function defined over the n -dimensional state space in terms of the model's primitives. The location and stability properties of optimal steady state candidates are characterized by the roots and derivatives of this function. A resource management example illustrates the simplicity and applicability of the method.

Suggested Citation

  • Yacov Tsur & Amos Zemel, 2017. "Steady state properties of multi-state economic models," Canadian Journal of Economics, Canadian Economics Association, vol. 50(2), pages 506-521, May.
    • Handle: RePEc:cje:issued:v:50:y:2017:i:2:p:506-521
    DOI: 10.1111/caje.12267
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    Cited by:

    1. Yacov Tsur & Amos Zemel, 2017. "Coping with Multiple Catastrophic Threats," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(1), pages 175-196, September.

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    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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