# Ramsey policy in linear model

**URL:** <https://forum.dynare.org/t/ramsey-policy-in-linear-model/15269>\
**Category:** Optimal Policy\
**Created:** [24 February 2020 08:16 UTC](https://forum.dynare.org/t/ramsey-policy-in-linear-model/15269 "2020-02-24T08:16:22Z")\
**Posts on this page:** 1\
**Showing post:** 8

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [26 February 2020 13:45 UTC](https://forum.dynare.org/t/ramsey-policy-in-linear-model/15269/8 "2020-02-26T13:45:39Z")

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I keep repeating myself. You cannot work with a linear utility function. But you may be able to express your nonlinear utility function in variables that measure deviations from steady state.

Related:

> [@Mix of equations in levels and log linearized form](https://forum.dynare.org/t/mix-of-equations-in-levels-and-log-linearized-form/5575/3):
>
> No, you can combine linearized and nonlinear equations provided that i) you only use a first order approximation and ii) correctly link the levels and percentage deviations. If z is the level of a variable, then zhat=log(z)-log(steady\_state(z))

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