ETD

• Bellman equation
• DSGE
• Dynamic
• Fiscal Policy
• Impulse Response Functions
• Lagrange function
• Log Linear
• Numerical Methods
• Optimization
• Rational Expectations
• Recursive Methods
• Representative Agent
• Solow
• Stochastic

The aim of this work is to provide a twofold approach to dynamic Macroeconomics: we present the economic theory behind the models and, moreover, we show the techniques necessary to numerically solve them (when closed form solutions are not obtainable) and to compute (in the case of DSGE models) the impulse response functions in presence of fiscal policy shocks. In almost all the models we assume that the behaviour of the society as a whole can be represented by that of a single representative agent, a strong assumption which is often criticized. Furthermore, in the last part of the thesis we provide a basic abstract of the main critiques to this hypothesis. The work is suitable for economists, basically because the mathematics applied is kept as simple as possible.