Review of Solution and Estimation Methods for Nonlinear Dynamic Stochastic General Equilibrium Models with the Zero Lower Bound

Yasuo Hirose, Takeki Sunakawa

Research output: Contribution to journalArticle


We review solution and estimation methods for nonlinear dynamic stochastic general equilibrium models and their application, with a special focus on the zero lower bound on the nominal interest rate. In a fully nonlinear setting, both the solution and estimation methods involve iterative procedures, and their computational expense grows rapidly with an increase in the dimensionality of state variables and parameters. We describe how the procedures deal with the dimensionality problem.

Original languageEnglish
JournalJapanese Economic Review
Publication statusAccepted/In press - 2019 Jan 1


ASJC Scopus subject areas

  • Economics and Econometrics

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