Click Here to Download: https://ouo.io/3unuiJ The Art of Smooth Pasting By: A. Dixit Publisher: Routledge Print ISBN: 9783718653843, 3718653842 eText ISBN: 9781317973720, 1317973720 Edition: 1st Pages: 88 Copyright year: 2001 Format: EPUB Available from $ 38.38 USD SKU 9781317973720R90 This book aims to widen the understanding of stochastic dynamic choice and equilibrium models. It offers a simplified and heuristic exposition of the theory of Brownian motion and its control or regulation, rendering such methods more accessible to economists who do not require a detailed, mathematical treatment of the subject. The main mathematical ideas are presented in a context which with which economists will be familiar. Using a binomial approach to Brownian motion, the mathematics is reduced to simple algebra, progressing to some equally simple limits. The starting point of the calculus of Brownian motion - 'Ito's Lemma' - emerges by analogy with the economics of risk-aversion. Conditions for the optimal regulation of Brownian motion, including the important, but often mysterious, 'smooth pasting' condition, are derived in a similar way. Each theoretical derivation is illustrated by developing a significant economic application, drawn mainly from recent research in macroeconomics and international economics. Additional ISBNs 9780415269377, 9781317973737, 0415269377, 1317973739, 9780415269377, 0415269377
