Optimal Fiscal Policy in a Linear Stochastic Economy
AbstractThis code supports the text in Thomas J. Sargent and Francois R. Velde, Optimal Fiscal Policy in a Linear Stochastic Economy, in Ramon Marimon and Andrew Scott (eds), Computational Methods for the Study of Dynamic Economies, Chapter 9, Oxford University Press. This chapter describes in detail how to solve the so-called Stokey-Lucas model of optimal taxation and to program it in Matlab. The state-process is either governed by a first order linear difference equation or a first order Markov Chain.
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Bibliographic InfoSoftware component provided by Quantitative Macroeconomics & Real Business Cycles in its series QM&RBC Codes with number 130.
Programming language: Matlab
Date of creation: 1998
Date of revision:
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