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Time-consistent policies

Time-consistent policies
Time-consistent policies
In many cases the optimal open-loop policy to influence agents who solve dynamic problems is time inconsistent. We show how to construct a time-consistent open-loop policy rule. We also consider an additional restriction under which the time-consistent open-loop policy is stationary. We use examples to illustrate the properties of these tax rules.
time inconsistency, open-loop policies, stationarity
0022-0531
353-364
Karp, Larry
c0e2efad-f4e6-4fb9-9630-aaa8cf37b72e
Lee, In Ho
f9fa5dda-198f-4857-8fe5-82023a389d3c
Karp, Larry
c0e2efad-f4e6-4fb9-9630-aaa8cf37b72e
Lee, In Ho
f9fa5dda-198f-4857-8fe5-82023a389d3c

Karp, Larry and Lee, In Ho (2003) Time-consistent policies. Journal of Economic Theory, 112 (2), 353-364. (doi:10.1016/S0022-0531(03)00067-X).

Record type: Article

Abstract

In many cases the optimal open-loop policy to influence agents who solve dynamic problems is time inconsistent. We show how to construct a time-consistent open-loop policy rule. We also consider an additional restriction under which the time-consistent open-loop policy is stationary. We use examples to illustrate the properties of these tax rules.

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More information

Published date: 2003
Keywords: time inconsistency, open-loop policies, stationarity

Identifiers

Local EPrints ID: 32980
URI: https://eprints.soton.ac.uk/id/eprint/32980
ISSN: 0022-0531
PURE UUID: f0bd08f2-c1f4-4a19-9195-579553b9e6b3

Catalogue record

Date deposited: 15 May 2006
Last modified: 17 Jul 2017 15:54

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