RDP 8611: The Effectiveness of Fiscal Policy in an Economy with Anticipatory Wage Contracts Equation (28)

[\begin{matrix} \dot{π} \\ \dot{y} \\ \dot{b} \end{matrix}] = [\begin{matrix} \frac{1}{ℓ_{i}} (1 - ξ + η ℓ_{y}) & \frac{1}{ℓ_{i}} [ℓ_{i} (\hat{π} + n - ϕ) - \frac{(ρ e^{\hat{b}} - t)}{\hat{D}}] & \frac{- α}{ℓ_{i}} (ρ - θ) e^{\hat{b} - \hat{m}} \\ η & - ϕ & 0 \\ 0 & n \frac{(ρ e^{\hat{b}} t)}{\hat{D}} & - n \end{matrix}] [\begin{matrix} (π - \hat{π}) \\ y - \hat{y} \\ (b - \hat{b}) \end{matrix}]