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Record W3121199971 · doi:10.22004/ag.econ.274648

The Krusell-Smith Algorithm: Are Self-fulfilling Equilibria Likely?

2014· preprint· en· W3121199971 on OpenAlexaff
Marco Cozzi

Bibliographic record

VenueAgEcon Search (University of Minnesota, USA) · 2014
Typepreprint
Languageen
FieldEconomics, Econometrics and Finance
TopicEconomic theories and models
Canadian institutionsQueen's University
Fundersnot available
KeywordsEconomicsConsumption (sociology)Aggregate (composite)Benchmark (surveying)PopulationProduct (mathematics)Capital (architecture)Stability (learning theory)Incomplete marketsSequence (biology)Fraction (chemistry)General equilibrium theoryEconometricsMicroeconomicsMathematical economicsMathematicsComputer scienceChemistry

Abstract

fetched live from OpenAlex

I investigate whether the popular Krusell and Smith algorithm used to solve heterogeneous-agent economies with aggregate uncertainty and in- complete markets is likely to be subject to multiple self-fullling equilibria. In a benchmark economy, the parameters representing the equilibrium ag- gregate law of motion are randomly perturbed 500 times, and are used as the new initial guess to compute the equilibrium with this algorithm. In a sequence of cases, diering only in the magnitude of the perturbations, I do not nd evidence of multiple self-fullling equilibria. The economic reason behind the result lies in a self-correcting mechanism present in the algorithm: compared to the equilibrium law of motion, a candidate one implying a higher (lower) expected future capital reduces (increases) the equilibrium interest rates, increasing (reducing) the savings of the wealth- rich agents only. These, on the other hand, account for a small fraction of the population and cannot compensate for the opposite change triggered by the wealth-poor agents, who enjoy higher (lower) future wages and increase (reduce) their current consumption. Quantitatively, the change in behavior of the wealth-rich agents has a negligible impact on the de- termination of the change in the aggregate savings, inducing stability in the algorithm as a by-product.

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

How this classification was reachedexpand

Full frame machine prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.

metaresearch head score (Codex)0.003
metaresearch head score (Gemma)0.024
Version: metacan-v3-hybrid-931329e0061cValidation status: machine_predicted_unvalidated
Candidate categoriesnone
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Theoretical or conceptual · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: none
Teacher disagreement score0.006
Threshold uncertainty score0.018

Distilled classifier scores by category (both heads)

CategoryCodexGemma
Metaresearch0.0030.024
Meta-epidemiology (narrow)0.0010.000
Meta-epidemiology (broad)0.0010.001
Bibliometrics0.0010.001
Science and technology studies0.0010.001
Scholarly communication0.0010.002
Open science0.0010.001
Research integrity0.0020.001
Insufficient payload (model declined to judge)0.0060.001

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.036
GPT teacher head0.208
Teacher spread0.172 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.

The models applied no category: nothing in the taxonomy fit this work.
Study designTheoretical or conceptual
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations1
Published2014
Admission routes1
Has abstractyes

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