|
|
|
|
Title: |
Adjustment under Uncertainty with Computable
General Equilibrium Models: General Theory and an Application to Korea |
| Author: |
Adelman, Irma;
Roland-Holst, David W.; Sarris, Alexander H. |
| Author
Affiliation: |
U CA, Berkeley;
US ITC; U Athens |
| Source: |
International Economic Journal, Summer 1990, v. 4, no. 2, pp. 1-20 |
|
Publication Date: |
Summer 1990 |
|
Abstract: |
Economic policy formulation in the
presence of uncertainty is studied in a general equilibrium framework
using techniques adapted from the theory of stochastic optimal control.
The structure of the economy is represented by a dynamic computable
general equilibrium model. Adjustment rules are derived by minimizing an
expected loss function whose arguments are the deviations of a set of
targets from an intended time path. Adjustment matrices are derived to
provide ex ante rules for automatic policy response to unexpected
fluctuations in economic conditions which keep target variables near
their intended paths. |
|
