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What makes those models difficult to solve? Where can I read about such a model? It seems plausible that something would be computationally intractable; it seem

• huitzitziltzin 3y ago
  It’s not that you can’t do any modeling at all - that’s definitely not the point I was trying to convey. It’s hard and you have to simplify. That simplicity has a benefit (tractability) and a cost (there is inevitably less realism). If you want to learn more, you are spoiled for choice. There are lots of places to look. Here’s a random list from the top of my head right now. Ljungqvist and Sargent’s Recursive Macroeconomic Theory is a standard grad level text taught nearly everywhere. Has been for probably 20 years. Stokey, Lucas and Prescott is another, more math methods focused. DeJong and Dave is a macro empirics book. Jianjun Miao’s book is another solid option. Stachurski focuses on computational methods. Acemoglu has a book on modern growth theory. McCandless “the abcs of rbcs” is IMO underappreciated. Beyond this you’ll need chapters from various volumes of the Handbook of Macro and related texts. There’s a long one by Fernandez-villaverde and co-authors about modern DSGE models. That’s available for free on his website I think. It’s a huge literature. If you are serious about it, enjoy and good luck!