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| Overview | |
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| Theory | |
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| Theory of Dynamic Programming | |
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| Overview | |
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| Indirect Utility | |
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| Consumers | |
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| Firms | |
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| Dynamic Optimization: A Cake-Eating Example | |
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| Direct Attack | |
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| Dynamic Programming Approach | |
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| Some Extensions of the Cake-Eating Problem | |
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| Infinite Horizon | |
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| Taste Shocks | |
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| Discrete Choice | |
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| General Formulation | |
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| Nonstochastic Case | |
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| Stochastic Dynamic Programming | |
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| Conclusion | |
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| Numerical Analysis | |
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| Overview | |
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| Stochastic Cake-Eating Problem | |
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| Value Function Iterations | |
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| Policy Function Iterations | |
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| Projection Methods | |
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| Stochastic Discrete Cake-Eating Problem | |
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| Value Function Iterations | |
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| Extensions and Conclusion | |
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| Larger State Spaces | |
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| Appendix: Additional Numerical Tools | |
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| Interpolation Methods | |
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| Numerical Integration | |
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| How to Simulate the Model | |
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| Econometrics | |
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| Overview | |
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| Some Illustrative Examples | |
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| Coin Flipping | |
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| Supply and Demand Revisited | |
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| Estimation Methods and Asymptotic Properties | |
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| Generalized Method of Moments | |
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| Maximum Likelihood | |
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| Simulation-Based Methods | |
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| Conclusion | |
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| Applications | |
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| Stochastic Growth | |
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| Overview | |
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| Nonstochastic Growth Model | |
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| An Example | |
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| Numerical Analysis | |
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| Stochastic Growth Model | |
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| Environment | |
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| Bellman's Equation | |
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| Solution Methods | |
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| Decentralization | |
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| A Stochastic Growth Model with Endogenous Labor Supply | |
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| Planner's Dynamic Programming Problem | |
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| Numerical Analysis | |
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| Confronting the Data | |
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| Moments | |
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| GMM | |
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| Indirect Inference | |
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| Maximum Likelihood Estimation | |
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| Some Extensions | |
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| Technological Complementarities | |
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| Multiple Sectors | |
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| Taste Shocks | |
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| Taxes | |
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| Conclusion | |
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| Consumption | |
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| Overview and Motivation | |
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| Two-Period Problem | |
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| Basic Problem | |
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| Stochastic Income | |
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| Portfolio Choice | |
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| Borrowing Restrictions | |
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| Infinite Horizon Formulation: Theory and Empirical Evidence | |
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| Bellman's Equation for the Infinite Horizon Problem | |
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| Stochastic Income | |
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| Stochastic Returns: Portfolio Choice | |
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| Endogenous Labor Supply | |
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| Borrowing Constraints | |
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| Consumption over the Life Cycle | |
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| Conclusion | |
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| Durable Consumption | |
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| Motivation | |
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| Permanent Income Hypothesis Model of Durable Expenditures | |
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| Theory | |
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| Estimation of a Quadratic Utility Specification | |
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| Quadratic Adjustment Costs | |
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| Nonconvex Adjustment Costs | |
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| General Setting | |
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| Irreversibility and Durable Purchases | |
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| A Dynamic Discrete Choice Model | |
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| Investment | |
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| Overview and Motivation | |
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| General Problem | |
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| No Adjustment Costs | |
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| Convex Adjustment Costs | |
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| Q Theory: Models | |
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| Q Theory: Evidence | |
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| Euler Equation Estimation | |
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| Borrowing Restrictions | |
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| Nonconvex Adjustment: Theory | |
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| Nonconvex Adjustment Costs | |
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| Irreversibility | |
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| Estimation of a Rich Model of Adjustment Costs | |
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| General Model | |
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| Maximum Likelihood Estimation | |
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| Conclusion | |
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| Dynamics of Employment Adjustment | |
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| Motivation | |
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| General Model of Dynamic Labor Demand | |
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| Quadratic Adjustment Costs | |
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| Richer Models of Adjustment | |
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| Piecewise Linear Adjustment Costs | |
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| Nonconvex Adjustment Costs | |
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| Asymmetries | |
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| The Gap Approach | |
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| Partial Adjustment Model | |
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| Measuring the Target and the Gap | |
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| Estimation of a Rich Model of Adjustment Costs | |
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| Conclusion | |
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| Future Developments | |
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| Overview and Motivation | |
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| Price Setting | |
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| Optimization Problem | |
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| Evidence on Magazine Prices | |
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| Aggregate Implications | |
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| Optimal Inventory Policy | |
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| Inventories and the Production-Smoothing Model | |
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| Prices and Inventory Adjustment | |
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| Capital and Labor | |
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| Technological Complementarities: Equilibrium Analysis | |
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| Search Models | |
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| A Simple Labor Search Model | |
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| Estimation of the Labor Search Model | |
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| Extensions | |
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| Conclusion | |
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| Bibliography | |
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| Index | |