Advanced Macro Julia Assignment

Project Overview

This repository contains the solution to the Advanced Macroeconomics – Julia Assignment (Fall 2023), covering three quantitative macroeconomic problems implemented in Julia / Jupyter Notebook.

Contents

• Coding_Assignment_final.ipynb
  Jupyter notebook containing all code, simulations, figures, and written answers (embedded as comments).

• TH.pdf
  Original assignment description provided by the lecturer.

Structure of the Assignment

Question 1: Dynamic Consumption (Life-Cycle Model)

• Numerical solution of a deterministic life-cycle consumption–savings problem
• Value function iteration on a fixed wealth grid
• Policy functions for consumption and wealth
• Simulations under alternative assumptions:
  • Initial wealth levels
  • Longer retirement horizon
  • Utility change (log vs. CRRA)
  • Interest rate change

Question 2: Home Flipping and Information Asymmetry

• Simulation of housing market data with noisy signals for two agent types
• Accuracy comparison via manual OLS regression implementation (closed-form solution)
• Selection rule for transactions and profit computation
• Visualizations: scatter plot (signals) and histogram (profits)

Question 3: Labor Search Model

• Infinite-horizon job search with unemployment benefits and job separation risk
• Value function iteration and acceptance policy over a discrete wage grid
• Simulation of earnings paths (single worker and 5,000-worker aggregate)
• Aggregate unemployment rate dynamics over 150 periods

Requirements

• Julia (or Jupyter Notebook with Julia kernel)
• Standard Julia libraries (e.g., Random, LinearAlgebra, Plots)

Notes

• Written answers are provided inside the notebook as code comments (as required).
• Figures are generated within the notebook.
• Randomness is generated via pseudo-random draws for simulation.