This paper deals with a classic development question: how can the process of economic
development – transition from stagnation in a traditional technology to industrialization
and prosperity with a modern technology – be accelerated?
This paper provides a general framework for the quantitative analysis of
stochastic dynamic models. We review convergence properties of some
numerical algorithms and available methods to bound approximation errors.
Limited commitment for the repayment of unsecured consumer debt originates from two places: (i) formal bankruptcy laws granting a partial or complete legal removal of unsecured debts under certain circumstances, and (ii) informal default followed by renegotiation, "delinquency."