This folder contains code that solves models from the paper of Bayer and Luetikke, "Solving heterogeneous agent models in discrete time with many idiosyncratic states by perturbation methods" found at:
https://cepr.org/active/publications/discussion_papers/dp.php?dpno=13071#
The paper solves three models, represented here in three places:
A Krusell-Smith model with a single asset: * [OneAsset-KS] * in Assets/One execute SteadyStateOneAssetIOUs.py then FluctuationsOneAssetIOUs.py
A HANK model with a single asset: * [OneAsset-HANK] * in Assets/One execute SteadyStateOneAssetIOUsBond.py then FluctuationsOneAssetIOUs.py
A HANK model with a liquid and an illiquid asset, [TwoAsset-HANK] * [TwoAsset-HANK] * in Assets/Two execute SteadyStateTwoAsset.py then FluctuationsTwoAsset.py
Other content:
- BayerLuetticke_wrapper.py creates a wrapper to the one asset version of BayerLuettike's code.
This file:
- Creates BayerLuettickeAgent and BayerLuettickeEconomy which are simple wrappers to BayerLuetikke's code, presently only the steady state part of this.
- Simulates a BayerLuettickeEconomy with 10,000 agents in steady state
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ConsIndShockModel_extension.py extends ConsIndShockModel to calculate and store a histogram of the distribution of agents.
- This is a starting point for an alternative method for creating the steady state required as an input for the BL method. (It's only a starting point because the remaining steps to format the output in the manner required by the BL code have not been taken).