Policy function calculation from value function iterations

We consider the following three switching models:

Model 1:

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.

.

where

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.

.

Model 2:

.

.

.

where

.

.

.

Model 3:

.

.

.

where

.

.

.

and

.

.

.

In each model, constant labors are computed in the same way as what we did before

in mixed models.

Technically, all we have to do is make index vectors for states as in 0812 and set them.