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I want to simulate a search and matching model very close to the canonical model developed by Pissarides. I am interested in representing the trajectory of the unemployment rate when the unemployment insurance parameters are changed by the government.

I have never done numerical simulations of general equilibrium models before so I don't really know where and how to start. I am coding in Matlab, and I began by calculating the steady-state equilibrium values of the endogenous parameters but I would also like to model their dynamic behavior, in particular the transition to a new steady-state. Do you know how I can do that ?

Thank you !

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  • $\begingroup$ The easiest way is to use Dynare on top of Matlab. You just enter the log linearized equations and shock the model. $\endgroup$
    – AKdemy
    May 1 at 19:12

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Not yet search and matching, but QuantEcon may be a useful start to get into the computation.

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