rm(list=ls())

#parameters
alpha <- 0.3
s <- 0.2
delta <- 0.05
n<-0.015
s_R <- 0.03
phi <- 0.95
lambda <- 0.1

#implied steady state growth rate of technology
g_A_star <- lambda*n/(1-phi)

#simulation length
T <- 500

A <- rep(0,T)
L <- rep(0,T)
ktilde <- rep(0,T)
y <- rep(0,T)
g_A <- rep(0,T)
dot_A <- rep(0,T)
dot_ktilde <- rep(0,T)
g_y <- rep(0,T)

#initial values
A[1] <- 1
L[1] <- 10
ktilde[1] <- (s/(delta+n+n))^(1/(1-alpha))

#theta that is consistent with g_A_star
theta1 <- g_A_star*A[1]^(1-phi)/((s_R*L[1])^lambda)

#increase in theta
theta2 <- 1.3*theta1