Solutions for http://quant-econ.net/lqramsey.html
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%matplotlib inline
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import numpy as np
import matplotlib.pyplot as plt
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from numpy import array
from lqramsey import *
# == Parameters == #
beta = 1 / 1.05
rho, mg = .95, .35
A = array([[0, 0, 0, rho, mg*(1-rho)],
[1, 0, 0, 0, 0],
[0, 1, 0, 0, 0],
[0, 0, 1, 0, 0],
[0, 0, 0, 0, 1]])
C = np.zeros((5, 1))
C[0, 0] = np.sqrt(1 - rho**2) * mg / 8
Sg = array((1, 0, 0, 0, 0)).reshape(1, 5)
Sd = array((0, 0, 0, 0, 0)).reshape(1, 5)
Sb = array((0, 0, 0, 0, 2.135)).reshape(1, 5) # Chosen st. (Sc + Sg) * x0 = 1
Ss = array((0, 0, 0, 0, 0)).reshape(1, 5)
economy = Economy(beta=beta,
Sg=Sg,
Sd=Sd,
Sb=Sb,
Ss=Ss,
discrete=False,
proc=(A, C))
T = 50
path = compute_paths(T, economy)
gen_fig_1(path)
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