Models with non-normal shocks (Non-linear transformation of shocks)

General DSGE Modeling
2
  1. Perturbation AIM is essentially standard perturbation as in Dynare, with the underlying computation algorithm working somewhat differently.
  2. Have a look at Stochastic Simulation based on Non-Normal Shocks
  3. Computing the equity premium is not really about the approximation point, but the approach to capture it. Jermann (1998) for example uses a first order approximation around the deterministic steady state but still is able to compute an equity premium.