Write a program to compute the autarky solution

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Optimal unemployment compensation

a. Write a program to compute the autarky solution, and use it to reproduce Hopenhayn and Nicolini's calibration of r, as described in text.

b. Use your calibration from part a. Write a program to compute the optimum value function C(V ) for the insurance design problem with incomplete information. Use the program to form versions of Hopenhayn and Nicolini's table 1, column 4 for three different initial values of V , chosen by you to belong to the set (Vaut, V e).

Reference no: EM131264049

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