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A0411
Title: A theory of pruning Authors:  Giovanni Lombardo - BIS (Switzerland) [presenting]
Harald Uhlig - University of Chicago (United States)
Abstract: Often, numerical simulations for dynamic, stochastic models in economics are needed. Higher order methods can be attractive, but bear the danger of generating explosive solutions in originally stationary models. Previously, it has been proposed pruning to deal with this challenge for second order approximations. We provide a theory of pruning and formulas for pruning of any order. We relate it to results on perturbing dynamical systems.