The package contains the MATLAB implementation of the Extended Function Path (EFP) algorithm developed in “A Tractable Framework for Analyzing a Class of Nonstationary Markov Models” (Quantitative Economics, 2020, Volume 11, Issue 4 pp. 1289-1323).
The software provides a complete, replicable computational framework for solving a nonstationary neoclassical stochastic growth model with labor-augmenting technological progress. It includes:
- A main script (Main_EFP.m) implementing the EFP solution and comparing it with the balanced growth path benchmark.
- Numerical integration routines using Gauss–Hermite quadrature.
- Polynomial basis construction modules for multidimensional approximation.
- A predefined Smolyak sparse grid for efficient state-space approximation.
- A shock simulation file (epsi.mat) enabling reproducible stochastic simulations and performance comparisons.
; Maliar, Lilia