GE (version 0.2.5)

gemPriceRegulation: Some Examples of Price Regulation

Description

Some examples of price regulation. When a price regulation policy is imposed in a structural dynamic model, the economy may converge to a fixed point (i.e. a price regulation equilibrium) where the market does not clear.

Usage

gemPriceRegulation(...)

Arguments

...

arguments to be passed to the function sdm2.

Examples

# NOT RUN {
dst.firm <- node_new("output",
  type = "CD", alpha = 5,
  beta = c(0.5, 0.5),
  "prod", "lab"
)

dst.consumer <- node_new("utility",
  type = "CD", alpha = 1,
  beta = c(0.5, 0.5),
  "prod", "lab"
)

f <- function(pExg = NULL, policy = NULL) {
  ge <- sdm2(
    A = list(dst.firm, dst.consumer),
    B = diag(c(1, 0), 2, 2),
    S0Exg = {
      S0Exg <- matrix(NA, 2, 2)
      S0Exg[2, 2] <- 100
      S0Exg
    },
    names.commodity = c("prod", "lab"),
    names.agent = c("firm", "consumer"),
    numeraire = "lab",
    maxIteration = 1,
    numberOfPeriods = 100,
    p0 = c(0.16, 1),
    ts = TRUE,
    pExg = pExg,
    policy = policy
  )

  print(ge$p)
  print(ge$z)
  par(mfrow = c(1, 2))
  matplot(ge$ts.p, type = "l")
  matplot(ge$ts.z, type = "l")
  ge
}

## No price regulation policy.
f()

## Set the market prices to the steady equilibrium prices from the beginning.
## The labor market keeps oversupplied.
result <- f(pExg = c(0.16, 1))
matplot(result$ts.q, type = "l") # sale rates

## the same as above
f(policy = function(state) {
  state$p <- c(0.16, 1)
  state
})

## The price regulation policy is implemented from the tenth period.
f(policy = function(time, state) {
  if (time >= 10) state$p <- c(0.16, 1)
  state
})

# }