204A-SolowWS - Application: Working with the Solow Model...

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Application: Working with the Solow Model Instructions: Results: 1. Set initial steady state: Blue values 1. Steady states = red 2. Set changes: Enter yellow boxes 2. Period-0 values = green [Default = 10% less capital] 3. Transition path = see table and charts Changes: Effective period zero • Default: if blank = initial value Initial Conditions: Steady state (change parameters as needed) • If no change is marked, graphs will show a default change: 10% cut in capital Parameters Value Meaning Parameters Change pts Parameter set Change % Change Pts Case of Disturbances: Alpha 33.3% Capital share Alpha 33.3% 0.0% 0.0% Half-life 17.3 (years) Delta 4.0% Depreciation rate Delta 4.0% 0.0% 0.0% n 1.0% Growth of workforce n 1.0% 0.0% 0.0% Case of Savings rate changes: g 1.0% Growth of productivity g 1.0% 0.0% 0.0% Recovery: na (years) s 16.7% Investment rate s 16.7% 0.0% 0.0% to initial consumption Disturbances Initial Values (normalization - no need to set) Variable Change % Value in t=0 Change %
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This note was uploaded on 12/26/2011 for the course ECON 240a taught by Professor Staff during the Fall '08 term at UCSB.

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