A procedure for simulating linear models in continuous time with perfect foresight and hysteresis
DOI:
https://doi.org/10.24201/ee.v13i1.242Keywords:
linear models, histeresis, Austin and Buiter, BuiterAbstract
This work presents a procedure to simulate continuous linear models with perfect foresight and histeresis. The procedure, which constitutes the basis of the LPFH algorithm, is based on a generalization of the standard structural form introduced by Austin and Buiter (1982) and Buiter (1984), and allows for the numerical solution of models with many state variables.