The Art of Smooth Pasting

This book aims to widen the understanding of stochastic dynamic choice and equilibrium models.

The Art of Smooth Pasting

This book aims to widen the understanding of stochastic dynamic choice and equilibrium models. It offers a simplified and heuristic exposition of the theory of Brownian motion and its control or regulation, rendering such methods more accessible to economists who do not require a detailed, mathematical treatment of the subject. The main mathematical ideas are presented in a context which with which economists will be familiar. Using a binomial approach to Brownian motion, the mathematics is reduced to simple algebra, progressing to some equally simple limits. The starting point of the calculus of Brownian motion - 'Ito's Lemma' - emerges by analogy with the economics of risk-aversion. Conditions for the optimal regulation of Brownian motion, including the important, but often mysterious, 'smooth pasting' condition, are derived in a similar way. Each theoretical derivation is illustrated by developing a significant economic application, drawn mainly from recent research in macroeconomics and international economics.

More Books:

The Art of Smooth Pasting
Language: en
Pages: 88
Authors: A. Dixit
Categories: Business & Economics
Type: BOOK - Published: 2013-11-12 - Publisher: Routledge

This book aims to widen the understanding of stochastic dynamic choice and equilibrium models. It offers a simplified and heuristic exposition of the theory of Brownian motion and its control or regulation, rendering such methods more accessible to economists who do not require a detailed, mathematical treatment of the subject.
Economic Modelling
Language: en
Pages:
Authors: Thomas R. Palfrey
Categories: Bayesian statistical decision theory
Type: BOOK - Published: 2001 - Publisher:

Books about Economic Modelling
The Art of Smooth Pasting
Language: en
Pages: 72
Authors: Avinash Kamalakar Dixit
Categories: Bayesian statistical decision theory
Type: BOOK - Published: 1994 - Publisher:

Books about The Art of Smooth Pasting
The Art of Smooth Pasting
Language: en
Pages: 88
Authors: A. Dixit
Categories: Business & Economics
Type: BOOK - Published: 2013-11-12 - Publisher: Routledge

This book aims to widen the understanding of stochastic dynamic choice and equilibrium models. It offers a simplified and heuristic exposition of the theory of Brownian motion and its control or regulation, rendering such methods more accessible to economists who do not require a detailed, mathematical treatment of the subject.
The Art of Smooth Pasting
Language: en
Pages: 72
Authors: Avinash K. Dixit
Categories: Business & Economics
Type: BOOK - Published: 2001 - Publisher: Psychology Press

This book aims to widen the understanding of stochastic dynamic choice and equilibrium models. It offers a simplified and heuristic exposition of the theory of Brownian motion and its control or regulation, rendering such methods more accessible to economists who do not require a detailed, mathematical treatment of the subject.