Utility Function - 3 Occupational Choice
This function evaluates the utility at each combination of current assets, entrepreneurial productivity, labor opportunity and future assets a' for a 3 OC model
Back to full code page https://kritikhanna.github.io/BKS-modified/
Function Inputs : asset grid(1 by M) and entrepreneurial productivity grid(1 by N), labor opportunity grid (1 by 2) relevant model parameters required Calls the 3 OC to evaluate COH required to compute utility
Function Outputs : Matrix of utility (both M X N X M) for each combination of a and z and a'
Contents
function [mt_util,mt_coh, mt_k, mt_l, mt_o]=hhsave_util_3OC(varargin)
close all; bl_profile = false; % Switch off profile if running a tester/calling from another function if(bl_profile) profile off; profile on; end addpath(genpath('/Users/sidhantkhanna/Documents/GitHub/BKS modified/'));
Assigning parameters
if ~isempty(varargin) [ar_a,ar_z,ar_n, ... fl_alpha,fl_theta,fl_delta,fl_kappa,fl_r,fl_w,fl_phi,fl_ahi,fl_zhi, ... fl_risk,it_zgridno, it_agridno,it_ngridno ... ] = varargin{:}; bl_print = false; else close all; fl_ahi = 5; fl_zhi = 2.2; it_agridno = 4; it_zgridno = 5; it_ngridno = 2; ar_a = linspace(0,fl_ahi,it_agridno); ar_z = linspace(1,fl_zhi,it_zgridno); fl_phi = 0; fl_risk = 1; ar_n = [0,1]; fl_alpha = 0.4; fl_theta = 0.79-fl_alpha; fl_delta = 0.05; fl_kappa = 0; [fl_r,fl_w] = ... deal(0.05,1.5); bl_print = true; end fl_R = fl_r + fl_delta;
Calling OC3
[mt_o, mt_coh, mt_k, mt_l] = OC3(ar_a,ar_z,ar_n, ... fl_alpha,fl_theta,fl_delta,fl_kappa,fl_r,fl_w,fl_phi,fl_ahi,fl_zhi, ... it_zgridno, it_agridno, it_ngridno);
Computing consumption
mt4_coh= repmat (mt_coh, [1 1 1 it_agridno]); %Projecting COH matrix to a 4th dimension of size of asset grid which will be used for evaluating optimal future assets mt_futassets=ones(it_agridno, it_zgridno, it_ngridno, it_agridno).*ar_a'; % 4d asset matrix to subtract future assets from COH to compute consumption mt_futassets=permute(mt_futassets,[4 2 3 1]); mt_con = mt4_coh-mt_futassets; % Consumption Matrix for each a, z, future a neg = find(mt_con<0); zero = find(mt_con==0); %mt_con(neg) = NaN; if(fl_risk==1) mt_util=log(mt_con); else mt_util= (mt_con.^(1-fl_risk) -1)/(1-fl_risk); % Utility Part of value function end mt_util(neg) = -10^20; mt_util(zero) = -10^10;
Printing outputs
if(bl_print) disp('Below is the COH matrix for for all combinations of a, z, n and future a'); disp(mt4_coh); disp('Below is the future assets matrix for each combination of a, z, n and future a'); disp(mt_futassets); disp('Below is the consumption matrix for for all combinations of a, z, n and future a'); disp(mt_con); disp('Below is the utility matrix for for all combinations of a, z, n and future a'); disp(mt_util); end if(bl_profile) profile off; profile viewer; st_file_name = '/Users/sidhantkhanna/Documents/GitHub/BKS modified/code/Profile/Households/hhsave_util_2OC'; profsave(profile('info'), st_file_name); end
Below is the COH matrix for for all combinations of a, z, n and future a
(:,:,1,1) =
0 0 0 0 0
1.9437 2.1374 2.3621 2.6155 2.8959
3.7344 4.0396 4.3935 4.7927 5.2345
5.4913 5.8888 6.3505 6.8713 7.4477
(:,:,2,1) =
1.5000 1.5000 1.5000 1.5000 1.5000
3.2500 3.2500 3.2500 3.2500 3.2500
5.0000 5.0000 5.0000 5.0000 5.2345
6.7500 6.7500 6.7500 6.8713 7.4477
(:,:,1,2) =
0 0 0 0 0
1.9437 2.1374 2.3621 2.6155 2.8959
3.7344 4.0396 4.3935 4.7927 5.2345
5.4913 5.8888 6.3505 6.8713 7.4477
(:,:,2,2) =
1.5000 1.5000 1.5000 1.5000 1.5000
3.2500 3.2500 3.2500 3.2500 3.2500
5.0000 5.0000 5.0000 5.0000 5.2345
6.7500 6.7500 6.7500 6.8713 7.4477
(:,:,1,3) =
0 0 0 0 0
1.9437 2.1374 2.3621 2.6155 2.8959
3.7344 4.0396 4.3935 4.7927 5.2345
5.4913 5.8888 6.3505 6.8713 7.4477
(:,:,2,3) =
1.5000 1.5000 1.5000 1.5000 1.5000
3.2500 3.2500 3.2500 3.2500 3.2500
5.0000 5.0000 5.0000 5.0000 5.2345
6.7500 6.7500 6.7500 6.8713 7.4477
(:,:,1,4) =
0 0 0 0 0
1.9437 2.1374 2.3621 2.6155 2.8959
3.7344 4.0396 4.3935 4.7927 5.2345
5.4913 5.8888 6.3505 6.8713 7.4477
(:,:,2,4) =
1.5000 1.5000 1.5000 1.5000 1.5000
3.2500 3.2500 3.2500 3.2500 3.2500
5.0000 5.0000 5.0000 5.0000 5.2345
6.7500 6.7500 6.7500 6.8713 7.4477
Below is the future assets matrix for each combination of a, z, n and future a
(:,:,1,1) =
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
(:,:,2,1) =
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
(:,:,1,2) =
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
(:,:,2,2) =
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
1.6667 1.6667 1.6667 1.6667 1.6667
(:,:,1,3) =
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
(:,:,2,3) =
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
3.3333 3.3333 3.3333 3.3333 3.3333
(:,:,1,4) =
5 5 5 5 5
5 5 5 5 5
5 5 5 5 5
5 5 5 5 5
(:,:,2,4) =
5 5 5 5 5
5 5 5 5 5
5 5 5 5 5
5 5 5 5 5
Below is the consumption matrix for for all combinations of a, z, n and future a
(:,:,1,1) =
0 0 0 0 0
1.9437 2.1374 2.3621 2.6155 2.8959
3.7344 4.0396 4.3935 4.7927 5.2345
5.4913 5.8888 6.3505 6.8713 7.4477
(:,:,2,1) =
1.5000 1.5000 1.5000 1.5000 1.5000
3.2500 3.2500 3.2500 3.2500 3.2500
5.0000 5.0000 5.0000 5.0000 5.2345
6.7500 6.7500 6.7500 6.8713 7.4477
(:,:,1,2) =
-1.6667 -1.6667 -1.6667 -1.6667 -1.6667
0.2771 0.4707 0.6954 0.9488 1.2292
2.0678 2.3729 2.7268 3.1261 3.5678
3.8246 4.2221 4.6839 5.2047 5.7810
(:,:,2,2) =
-0.1667 -0.1667 -0.1667 -0.1667 -0.1667
1.5833 1.5833 1.5833 1.5833 1.5833
3.3333 3.3333 3.3333 3.3333 3.5678
5.0833 5.0833 5.0833 5.2047 5.7810
(:,:,1,3) =
-3.3333 -3.3333 -3.3333 -3.3333 -3.3333
-1.3896 -1.1959 -0.9713 -0.7178 -0.4374
0.4011 0.7062 1.0602 1.4594 1.9012
2.1579 2.5554 3.0172 3.5380 4.1143
(:,:,2,3) =
-1.8333 -1.8333 -1.8333 -1.8333 -1.8333
-0.0833 -0.0833 -0.0833 -0.0833 -0.0833
1.6667 1.6667 1.6667 1.6667 1.9012
3.4167 3.4167 3.4167 3.5380 4.1143
(:,:,1,4) =
-5.0000 -5.0000 -5.0000 -5.0000 -5.0000
-3.0563 -2.8626 -2.6379 -2.3845 -2.1041
-1.2656 -0.9604 -0.6065 -0.2073 0.2345
0.4913 0.8888 1.3505 1.8713 2.4477
(:,:,2,4) =
-3.5000 -3.5000 -3.5000 -3.5000 -3.5000
-1.7500 -1.7500 -1.7500 -1.7500 -1.7500
0 0 0 0 0.2345
1.7500 1.7500 1.7500 1.8713 2.4477
Below is the utility matrix for for all combinations of a, z, n and future a
(:,:,1,1) =
1.0e+10 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
(:,:,2,1) =
0.4055 0.4055 0.4055 0.4055 0.4055
1.1787 1.1787 1.1787 1.1787 1.1787
1.6094 1.6094 1.6094 1.6094 1.6553
1.9095 1.9095 1.9095 1.9274 2.0079
(:,:,1,2) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-0.0000 -0.0000 -0.0000 -0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
(:,:,2,2) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
(:,:,1,3) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-0.0000 -0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
(:,:,2,3) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
0.0000 0.0000 0.0000 0.0000 0.0000
0.0000 0.0000 0.0000 0.0000 0.0000
(:,:,1,4) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-1.0000 -1.0000 -1.0000 -1.0000 -0.0000
-0.0000 -0.0000 0.0000 0.0000 0.0000
(:,:,2,4) =
1.0e+20 *
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-1.0000 -1.0000 -1.0000 -1.0000 -1.0000
-0.0000 -0.0000 -0.0000 -0.0000 -0.0000
0.0000 0.0000 0.0000 0.0000 0.0000