Intro to Mathematical Economics
Collocation methods are numerical techniques used to approximate the solutions of differential equations, particularly useful in the context of optimal control problems. These methods involve selecting a set of points (collocation points) and using them to convert differential equations into a system of algebraic equations, which can then be solved more easily. This approach is particularly significant in addressing the Hamilton-Jacobi-Bellman equation, where finding optimal policies and value functions is essential for dynamic programming.
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