# GRO1.yaml Model definition file for the stochastic growth model
# Copyright (C) 2011-2013 Christophe Gouel
# Licensed under the Expat license, see LICENSE.txt
model_type: fgh2

declarations:

  states: [K, Z]

  controls: [C]

  expectations: [E]

  shocks: [Epsilon]

  parameters: [a, tau, delta, beta, rho, alpha]


equations:

  arbitrage:

    - C^(-tau)-beta*E=0 | -inf <= C <= inf

  transition:

    - K = a*exp(Z(-1))*K(-1)^alpha+(1-delta)*K(-1)-C(-1)
    - Z = rho*Z(-1)+Epsilon

  expectation:

    - E = C(1)^(-tau)*(1-delta+a*alpha*exp(Z(1))*K(1)^(alpha-1))

calibration:

  parameters:

    tau   : 2
    delta : 0.0196
    beta  : 0.95
    rho   : 0.9
    alpha : 0.33
    a     : (1/beta-1+delta)/alpha

  steady_state:

    Z : 0
    K : 1
    C : a-delta
    E : C^(-tau)/beta