Time-invariant equilibrium

Recall the model written in section X. The agents decision depends on the values processes, which are pinned down by aggregate conditions. These conditions are fixed in an additional equilibrium section.

Let us start from an example:

symbols:
    exogenous: [z]
    aggregate: [K]
    parameters: [A, alpha, delta, ρ]


calibration:
    A: 1
    alpha: 0.36
    delta: 0.025
    K: 40
    z: 0
    ρ: 0.95

exogenous: !AR1
    ρ: ρ
    σ: σ

equilibrium:
    K = k

Graphical represenation

heterogeneity

Now, a model with idiosyncratic heterogeneity:

symbols:
    exogenous: [z]
    aggregate: [K]
    parameters = [A, alpha, delta, ρ]
)

calibration:
    A: 1
    alpha: 0.36
    delta: 0.025
    K: 40
    z: 0
    ρ: 0.95

exogenous: !AR1
    ρ: ρ
    σ: σ

equilibrium:
    K = k

heterogeneity:
    β: !Uniform
        a: 0.95
        b: 0.96