ECON 610: Microeconomic Theory II
Prof. Blume
Problem Set 1
1
Problem Set 1
This is a solution key for problem set 1. Some intermediate steps are left to the reader. If you still have questions regarding any of the problems, please visit Prof. Bl
ECON 610: Microeconomic Theory II
Prof. Blume
Problem Set 2
1
Problem Set 2
This is a solution key for problem set 2. Some intermediate steps are left to the reader. If you still have questions regarding any of the problems, please visit Prof. Bl
Homework 4, Econ 606
Jonathan Heathcote
Due in class, Tuesday March 28th
Consider the following economy
Each period a continuum of mass (1 ) agents are born at age 0
Agents survive from age a to a + 1 with constant probability .
The total population is
(1
Homework 3 - Partial Answers
Jonathan Heathcote
Due in Class on Tuesday February 28th
In class we outlined two versions of the stochastic growth model: a planners
problem, and an Arrow-Debreu competitive equilibrium. We were working towards showing that a
Homework 3
Jonathan Heathcote
Due in Class on Tuesday February 28th
In class we outlined two versions of the stochastic growth model: a planners
problem, and an Arrow-Debreu competitive equilibrium. We were working towards showing that allocations in the
Graduate Macro II, Homework 2
Jonathan Heathcote
Due in class on Thursday February 16th 2006
Consider the neoclassical growth model in discrete time. In the two examples below, you are asked to solve for ecient allocations by considering social
planners p
Alejandro Badel
Homework 1, Macro II Jonathan Heathcote : Answer
1) a) The set of Pareto E cient allocations coincides with the solutions to
the planning problem. By the Inada conditions, solutions to this problem are
always interior. Also, by strict conc
Graduate Macro II, Homework 1
Jonathan Heathcote
Due in class on Tuesday January 31st 2006
Recall the example economy we worked through following Chapter 2 in Dirk
Kruegers notes.
1. Consider the following alternative description of preferences and endowm
General Equilibrium with Incomplete Markets
Jonathan Heathcote
Updated April 2006
1. Heterogeneity
Consider an economy with a continuum of agents of total mass equal to 1. Each agents
productivity process is independent of all other agents current and pas
Consider the following economy
Each period a continuum of mass (1 ) agents are born at age 0
Agents survive from age a to a + 1 with constant probability .
The total population is
(1 )(1 + + 2 + .) = 1
Assume the environment is stationary, so we need not
Homework 5, Econ 606
Jonathan Heathcote
Due in class, Tuesday April 4th
Consider the following consumption-savings problem:
An individual faces two possible realizations for their wage in each period,
w cfw_wl , wh where 0 < wl < wh .
At time zero, w0 ma
Alejandro Badel.
Macro II, Jonathan Heatchote. Homework 5 Answers.
1)
Recursive formulation of the individual maximization problem:
s
state: (a; w) where a represents beggining of period bond holdings and w is
the current realization of the wage process.
Homework 6, Econ 606
Jonathan Heathcote
Due Tuesday April 18th
Consider the Huggett (1993) economy. Use his benchmark parameter values:
period length is two months, = 0.96 (annual basis) coecient of relative riskaversion = 1.5, eh = 1, el = 0.1, (eh |eh )
Homework 7
Jonathan Heathcote
due in class on Tuesday April 25th
1. Model
Consider the simple RBC model that we discussed in class. A representative agent /
social plannner solves the following problem:
max E0
cfw_ct cfw_kt+1
X
t
t=0
ct 1
1
subject to
ct
Introduction to Linearization Methods
Jonathan Heathcote
August 28th 2003
1.
1.1.
Solving systems of stochastic linear dierence equations (see
Farmers book)
Example of a rst order stochastic dierence equation.
xt+1 = b + axt + t+1
is a random variable.
C
MIDTERM, GRADUATE MACRO, ECON 606
Jonathan Heathcote
March 2nd 2006
Consider the following economy. There are two sectors: an apple sector,
and an orange sector. Both sectors use land F and labor n to produce. The
amount of land in each sector, Fo and Fa
MIDTERM, GRADUATE MACRO, ECON 606
Jonathan Heathcote
March 2nd 2006
Consider the following economy. There are two sectors: an apple sector,
and an orange sector. Both sectors use land F and labor n to produce. The
amount of land in each sector, Fo and Fa
Consumption and Labor Supply
with Partial Insurance
Jonathan Heathcote (Georgetown University)
Kjetil Storesletten (University of Oslo)
Gianluca Violante (New York University)
University of Montreal, March 17, 2006
Introduction
What are the facts about i
Short notes on a simple global solution method1
Consider the following recursive maximization problem:
(
)
P
V (a, e) = max u(c) +
(e0 |e)V (a0 , e0 )
0
c,a
e0 cfw_e1 ,e2
subject to
c e + (1 + r)a a0
a0
The Euler equation (substituting in the budget c
A couple of practice questions for the nal
Jonathan Heathcote
May 3rd 2006
Question 1: Consider the following economy
Each period a continuum of agents of mass (1 ) is born
These agents discount at rate , and survive from one period to the next
with con
Partial Answers: Final Practice Questions
May 5, 2006
Question 1
Solve for the price of stocks, pt
Lets assume that the total income of the young is yt , so per capita income
of the young is yt /(1 )
(we could assume yt is per capita income for the young
Stochastic income-uctuations problem
Focus on the case where shocks are iid through time
Look at the cases (1 + r) = 1 and (1 + r) > 1
End up looking at the two shock case e cfw_el , eh with constant relative risk
aversion preferences
Assume we have made
Economics 301 Fall 1999
301 - Fall 1999 - FINAL A
J. Wissink Cornell University
Directions: Answer all questions. Write legibly, concisely, and coherently. Be sure to label all axes, functions, and variables you use. READ QUESTIONS CAREFULLY. Draw
Dietrich Vollrath and Bent E. Srensen
June 27, 2005
Comprehensive Exam in Macroeconomic TheoryProcedural Instructions
(1) Write your answers only on the paper we will provide.
(2) We will be distributing a numbered signin sheet in a moment. The number nex
Dietrich Vollrath and Bent E. Srensen
June 25th, 2008
Comprehensive Exam in Macroeconomic TheoryProcedural Instructions
(1) Write your answers only on the paper we will provide.
(2) We will be distributing a numbered signin sheet in a moment. The number n
Dietrich Vollrath and Bent E. Srensen
June 24th, 2010
Comprehensive Exam in Macroeconomic TheoryProcedural Instructions
(1) Write your answers only on the paper we will provide.
(2) We will be distributing a numbered signin sheet in a moment. The number n
Dietrich Vollrath and Bent E. Srensen
January 10, 2008
Comprehensive Exam in Macroeconomic TheoryProcedural Instructions
(1) Write your answers only on the paper we will provide.
(2) We will be distributing a numbered signin sheet in a moment. The number
Dietrich Vollrath and Bent E. Srensen
January 15th, 2008
Comprehensive Exam in Macroeconomic TheoryProcedural Instructions
(1) Write your answers only on the paper we will provide.
(2) We will be distributing a numbered signin sheet in a moment. The numbe
Graduate Macroeconomics I: Final
Prof. Vollrath
December 7th, 2009
Instructions: Write your answers on blank paper. Start each problem on a new sheet. Write your
name and the problem number on EVERY page. Number every page.
Read the whole problem before y