# 应用经济学专题 Topics in Applied Economics ECON60482T

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$\left(K_{t+h} / L_{t}\right)\left(L_{t} / L_{t+h}\right)$, this model can again be reduced to the state variable $k$ now given by $k_{t}=K_{t} / L_{t}$ and gives then rise to:
$$k_{t+h}=\left(k_{t}+\operatorname{sh} f\left(k_{t}\right)\right) /(1+n h)$$
At first sight, this law of motion of the period version of the Solow model looks quite different compared to the one in continuous time
$$\dot{k}=s F(k, 1)-n k=s f(k)-n k$$
and its discretization by way of difference quotients
$$k_{t+h}=k_{t}+h\left(s f\left(k_{t}\right)-n k_{t}\right)=k_{t}+s h f\left(k_{t}\right)-n h k_{t}$$

## ECON60482TCOURSE NOTES ：

The Phillips curve of this approach to inflation dynamics is indeed given by
$$\pi_{t}=f\left(U_{t}\right)+\alpha \pi_{t}^{\epsilon}, \quad 0<\alpha \leq 1, f^{\prime}<0$$ and inflationary expectations $\pi_{t}^{e}$ are adjusted adaptively according to $$\pi_{t+1}^{e}=\pi_{t}^{e}+c\left(\pi_{t}-\pi_{t}^{e}\right), \quad 00$$