Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/95219
Authors: 
Albrecht, James W.
Holmlund, Bertil
Lang, Harald
Year of Publication: 
1986
Series/Report no.: 
IUI Working Paper 172
Abstract: 
This paper presents a technique for qualitative comparative statics analysis in dynamic programming models. Let the value function v be the fixed point of a contraction mapping which depends differentially on some exogenous parameter theta. Then the derivative of v with respect to theta exists and is also the fixed point of a contraction mapping. Since this derivative is the fixed point of a contraction mapping its qualitative properties can be investigated using mathematical induction. This comparative statics methodology is illustrated with an application to a model of job search.
Subjects: 
Qualitative comparative statics analysis
dynamic programming
job search model
JEL: 
C61
J60
Document Type: 
Working Paper

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