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On the accuracy of low-order projection methods

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  • Paul Pichler

    (University of Vienna)

Abstract

We use low-order projection methods to compute numerical solutions of the basic neoclassical stochastic growth model. We assess the quality of the obtained solutions, and compare them to numerical approximations derived with first and second-order perturbation techniques. We show that projection methods perform surprisingly poor when the degree of approximation is very low, and we provide some intuition behind this finding.

Suggested Citation

  • Paul Pichler, 2007. "On the accuracy of low-order projection methods," Economics Bulletin, AccessEcon, vol. 3(50), pages 1-8.
    • Handle: RePEc:ebl:ecbull:eb-07c60003
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    numerical accuracy;

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • E0 - Macroeconomics and Monetary Economics - - General

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