Behavior of capital

 

We consider the non-aggregate model with structural changes.

 

We keep index numbers to indM1 and indM2 together with state number vector sind

 

for the case with a single break. Then we set

 

k1=k[indM1[.,sind[t+1]]] for the first group

 

and

 

k1=k[indM2[.,sind[t+1]]] for the second group.

 

If we have two breaks, we will have

 

k1=k[indM3[.,sind[t+1]]] for the last group.

 

In general, we keep index numbers to indMs that is (n x dim) x dim matrix.

 

We pick every n elements in order.