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Solving Dynamic Equilibrium Models by a Method of Undetermined Coefficients

02.01.98

This paper presents an undetermined-coefficients method for obtaining a linear approximation to the solution of a dynamic rational-expectations model. It also showshow that solution can be used to compute the model?s implications for impulse response functions and for second moments.

Suggested citation: Christiano, Lawrence, 1998. “Large Shareholders and Market Discipline in a Regulated Industry: A Clinical Study of Mellon Bank,” Federal Reserve Bank of Cleveland, Working Paper, no. 98-04.

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