Solutions Manual for Recursive Methods in Economic Dynamics
Claudio Irigoyen
Esteban Rossi-Hansberg
Mark L. J. Wright
This solutions manual is a valuable companion volume to the classic textbook Recursive
Methods in Economic Dynamics by Nancy L. Stokey and Robert E. Lucas. The exercises in the
Stokey and Lucas book are integral to the text, and thus, a reader cannot fully appreciate
the text without understanding the results developed in the exercises. This manual
provides detailed answers to the central exercises in Recursive Methods.
The authors' selection of exercises is designed to maximize the reader's understanding of
Recursive Methods. Solutions are presented to every question in the core chapters on
recursive methods, as well as most questions from the chapters on mathematical background.
Some questions from the chapters on applications of these techniques to economic models
have been reserved so as to provide instructors with a crucual "test bank" of
questions.
Efficient and lucid in approach, this manual will greatly enhance the value of Recursive
Methods as a text for self-study.
Table of Contents
Foreword
1. Introduction
2. An Overview
3. Mathematical Preliminaries
4. Dynamic Programming under Certainty
5. Applications of Dynamic Programming under Certainty
6. Deterministic Dynamics
7. Measure Theory and Integration
8. Markov Processes
9. Stochastic Dynamic Programming
10. Applications of Stochastic Dynamic Programming
11. Strong Convergence of Markov Processes
12. Weak Convergence of Markov Processes
13. Applications of Convergence Results for Markov Processes
14. Laws of Large Numbers
15. Pareto Optima and Competitive Equilibria
16. Applications of Equilibrium Theory
17. Fixed-Point Arguments
18. Equilibria in Systems with Distortions
Paperback
304 pages
