Abstract
This paper takes a discrete-time adaptation of the continuous-time matching economy of Pissarides (1990, 2001) discussed in Ljungqvist and Sargent (2000) and computes the solution to the dynamic planning problem. The solution is shown to be completely characterized by a first-order, non-linear map which admits a unique stationary solution that is dynamically unapproachable from an arbitrary set of initial conditions. Oscillatory solutions are possible but there is no possibility of periodic solutions.
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