REVERSE SHOOTING IN A MULTI-DIMENSIONAL SETTING

This paper investigates the properties of dynamic solutions that have been derived using the well-known reverse-shooting algorithm. Given an arbitrary large-scale model about which we have limited information, how successful is the algorithm likely to be in solving this model? We address this question using a range of investment models, both linear and non-linear. By extending the investment models to allow for multidimensional specifications of the capital stock, we are able to examine the computational efficiency of the reverse shooting algorithm as the dimensionality of the capital stock is allowed to increase. Our approach provides insights into how the complexity of the solutions to a broad range of macroeconomic models increases with the dimensionality of the models.Macroeconomics; Reverse shooting; Saddlepath instability; Computational techniques; Investment models

Reverse-Shooting versus Forward-Shooting over a Range of Dimensionalities

This paper investigates the properties of dynamic solutions that have been derived using the well-known reverse-shooting and forwardshooting algorithms. Given an arbitrary large-scale model about which we have limited information, how successful are the algorithms likely to be in solving this model? We address this question using a range of investment models, both linear and non-linear. By extending the investment models to allow for multi-dimensional specifications of the capital stock, we are able to examine the computational efficiency of the competing algorithms as the dimensionality of the capital stock is allowed to increase. Our approach provides insights into how the complexity of the solutions to a broad range of macroeconomic models increases with the dimensionality of the models.Macroeconomics; Reverse-shooting; Forward-shooting; Saddlepath instability; Computational techniques; Investment models.

Profit Related Loans for Economically Disadvantaged Regions

There is an increasing recognition that economically disadvantaged areas do not have an inherent capacity to regenerate economic activity or to deliver automatically socially propitious outcomes. In such circumstances, there might be a strong case for public sector intervention of various types. In what follows we a case for the provision of financial resources for the establishment or consolidation of community social, and other, regional enterprises. The circumstances underlying the impotence of markets to solve financing issues are explored, and some attention is given to historical attempts to address the problem. Most importantly, we outline a potential new approach for the public sector in this area. An important and novel aspect of the exercise involves the government providing some proportion of the required finance in the form of a loan to be repaid by the enterprise only when and if the project becomes economically successful. This form of government intervention, known as income related loans, is designed to limit the extent of economic risks faced by the relevant enterprise, and has the desirable equity characteristic of repaying to taxpayers some return to their investment. Through reference to the Higher Education Contribution Scheme it is explained that the essential bases of this form of public sector approach to financing investment is well established, both conceptually and in administrative terms.community investment; income related loans

Comparison of Optimal Control Solutions in a Labor Market Model

In this paper a variety of computational optimal control techniques are compared on a complicated nonlinear discrete-time model. We use a labor market model with the objective of trying to obtain an unemployment rate objective, using an active labor market program as a control. In reality the control is constrained as only limited proportion of the unemployment can attend the labor market program. A variety of computational optimal control techniques are applied. The techniques include numerically linearizing the model and using standard linear quadratic optimal control and applying this to the nonlinear model; model based predictive control; and stacking the model over time and using optimisation techniquesLabour market policies; Optimal Control.

Profit related loans for economically disadvantaged regions

There is an increasing recognition that economically disadvantaged areas do not have an inherent capacity to regenerate economic activity or to deliver automatically socially propitious outcomes. In such circumstances, there might be a strong case for public sector intervention of various types. In what follows we a case for the provision of financial resources for the establishment or consolidation of community social, and other, regional enterprises. The circumstances underlying the impotence of markets to solve financing issues are explored, and some attention is given to historical attempts to address the problem. Most importantly, we outline a potential new approach for the public sector in this area. An important and novel aspect of the exercise involves the government providing some proportion of the required finance in the form of a loan to be repaid by the enterprise only when and if the project becomes economically successful. This form of government intervention, known as income related loans, is designed to limit the extent of economic risks faced by the relevant enterprise, and has the desirable equity characteristic of repaying to taxpayers some return to their investment. Through reference to the Higher Education Contribution Scheme it is explained that the essential bases of this form of public sector approach to financing investment is well established, both conceptually and in administrative terms