Dynamic Programming Squared¶

Here we look at models in which a value function for one Bellman equation has as an argument the value function for another Bellman equation

Lectures¶

• Dynamic Stackelberg Problems
  • Duopoly
  • The Stackelberg Problem
  • Stackelberg Plan
  • Recursive Representation of Stackelberg Plan
  • Computing the Stackelberg Plan
  • Exhibiting Time Inconsistency of Stackelberg Plan
  • Recursive Formulation of the Follower’s Problem
  • Markov Perfect Equilibrium
  • MPE vs. Stackelberg
• Optimal Taxation in an LQ Economy
  • Overview
  • The Ramsey Problem
  • Implementation
  • Examples
  • Exercises
  • Solutions
• Optimal Taxation with State-Contingent Debt
  • Overview
  • A Competitive Equilibrium with Distorting Taxes
  • Recursive Formulation of the Ramsey problem
  • Examples
  • Further Comments
• Optimal Taxation without State-Contingent Debt
  • Overview
  • Competitive Equilibrium with Distorting Taxes
  • Recursive Version of AMSS Model
  • Examples