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Approximations to viability kernels for sustainable macroeconomic policies

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  • Krawczyk, Jacek B
  • Pharo, Alastair
  • Simpson, Mark

Abstract

Maintaining an open economy within certain bounds on inflation, output gap and exchange rate can help sustainable economic development. Macroeconomics proposes monetary-policy models that describe evolution of the above quantities. We use one such model, constituted by a four-metastate one-control system, to compute viability kernel approximations that one can use to assist the central bank to establish "sustainable" policies. We propose a simple heuristic algorithm that leads to kernel approximations for this and similar models.

Suggested Citation

  • Krawczyk, Jacek B & Pharo, Alastair & Simpson, Mark, 2011. "Approximations to viability kernels for sustainable macroeconomic policies," Working Paper Series 18551, Victoria University of Wellington, School of Economics and Finance.
    • Handle: RePEc:vuw:vuwecf:18551
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    References listed on IDEAS

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    8. FILAR, Jerzy A. & KRAWCZYK, Jacek B. & AGRAWAL, Manju, 2009. "On production and abatement time scales in sustainable development. Can we loosen the sustainability screw ?," LIDAM Discussion Papers CORE 2009028, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    Cited by:

    1. Jacek Krawczyk & Kunhong Kim, 2014. "Viable Stabilising Non-Taylor Monetary Policies for an Open Economy," Computational Economics, Springer;Society for Computational Economics, vol. 43(2), pages 233-268, February.
    2. Krawczyk, Jacek B. & Judd, Kenneth L., 2014. "Which economic states are sustainable under a slightly constrained tax-rate adjustment policy," MPRA Paper 59027, University Library of Munich, Germany.

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