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Stochastic Growth Models With No Discounting
[Stochastické růstové modely bez diskontování]

Author

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  • Karel Sladký

Abstract

In this note, we consider in discrete time the Ramsey growth model without discounting under stochastic uncertainty modelled by Markov processes. To make the model computationally tractable we shall consider finite state approximations of the original model. Properties of policies maximizing mean value of the global utility of consumers over an infinite time horizon, along with algorithmic procedures finding optimal and suboptimal policies, are reported.

Suggested Citation

  • Karel Sladký, 2007. "Stochastic Growth Models With No Discounting [Stochastické růstové modely bez diskontování]," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2007(4), pages 88-98.
    • Handle: RePEc:prg:jnlaop:v:2007:y:2007:i:4:id:78:p:88-98
    DOI: 10.18267/j.aop.78
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    References listed on IDEAS

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    2. Amedeo R. Odoni, 1969. "On Finding the Maximal Gain for Markov Decision Processes," Operations Research, INFORMS, vol. 17(5), pages 857-860, October.
    3. David Cass, 1965. "Optimum Growth in an Aggregative Model of Capital Accumulation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 32(3), pages 233-240.
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    7. Cuong Le Van & Rose-Anne Dana, 2003. "Dynamic Programming in Economics," Post-Print halshs-00119098, HAL.
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    More about this item

    Keywords

    economic dynamics; stochastic version of the Ramsey growth model; Markov decision processes;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity

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