Recursive Methods have been developed and written about by award-winning scholars in the fields of economics, finance, and statistics (control theory) since the 1950s. We provide information on, and links to major works discussing recursive methods, including the Guide to Recursive Models that introduces important concepts, and other information on how to create a recursive model.
Other Important Resources
Richard Bellman pioneers a recursive method of solving multi-period decision problems under uncertainty in his book Dynamic Programming. He noted at that time the severe difficulties in using the method, including the “curse of dimensionality.”
The American Automatic Control Council established the Richard E. Bellman Control Heritage Award in 1979. This award is given annually for “achievements in Control Theory.”
Nancy Stokey and Robert Lucas establish important existence properties and other mathematical underpinnings of recursive methods in book Recursive Methods in Economic Dynamics (Harvard University Press, 1989). The book becomes a seminal work for next generation of economists.
Robert Lucas was the recipient of the 1995 Nobel Prize in Economics.
Avinash Dixit and Robert Pindyck describe the failings of traditional methods to solve common investment and business management problems in their book Investment Under Uncertainty (Princeton University Press, 1994). They demonstrated the theoretical superiority of a recursive model to some of these same problems.
Lars Lungqvist and Thomas Sargent outline multiple recursive models in the field of theoretical economics in Recursive Macroeconomic Theory (MIT Press, 2000), and revise the text in two additional editions. It becomes a standard text for advanced Economics students.
Thomas Sargent was the recipient of the 2011 Nobel Prize n Economics.
Patrick Anderson outlines the direct application of recursive methods to numerous business management, and life decision problems, and provides theoretical bases for such applications, in the book Economics of Business Valuation (Stanford University Press, 2013). He composes and solves examples in the book using a prototype of the Rapid Recursive® Toolbox.
Patrick Anderson was the recipient of the Edmund A. Mennis award given by the National Association of Business Economics for the top article of the year contributed to its journal Business Economics. The article is based on a recursive model composed and solved using the Rapid Recursive® Toolbox.
Other Important Resources
The Guide to Recursive Models by Patrick L. Anderson (order a bound copy (delivered in the US only)), March 2013. This guide introduces concepts of sequential decision problems, and the recursive approach to such problems. It also presents a rich set of such models that represent common decision problems, and which have already been composed into models that can be immediately solved by the Rapid Recursive® Toolbox.
The Solutions Manual and Reference for The Economics of Business Valuation, by Erin A. Grover, which is a supplemental reference to Economics of Business Valuation and provides a rich set of examples created by the Rapid Recursive® Toolbox.
We also provide a number of technical papers demonstrating the practical application of recursive methods.