# Example two --- Deterministic growth model with habit formation

states:
tech, cap
end

jumps:
cons
end

shocks:
end

parameters:
betta = 0.99
sigma = 1.1
gama = 0.8
delta = 0.025
alpha = 0.30
rho = 0.8
end

equations:
exp(cap(+1)) = (1.0 - delta)*exp(cap) + exp(tech)*exp(cap)^alpha - exp(cons)
(exp(cons) - gama*exp(cons(-1)))^(-sigma) = betta*(exp(cons(+1)) - gama*exp(cons))^(-sigma)*(1.0 - delta + alpha*exp(tech(+1))*exp(cap(+1))^(alpha - 1.0))
tech(+1) = rho*tech
end
