Steady-state vs Equilibrium path

General DSGE Modeling
1

In the solow model, if you wanna compare the effect of a higher savings rate, then you compare steady-state output (with no growth) under the new savings rate to a benchmark.

But if you wanna compare the effect of a higher labor efficiency growth rate, then you need to compare the entire new balanced growth path to the old BGP, right?

And I guess this is true for all policy analyses in non-stationary models where the policy affects the BGP.

2

In principle yes, but typically there exists a decomposition into changes of the BGP and changes around the BGP. See also DSGE_mod/Solow_nonstationary.mod at master · JohannesPfeifer/DSGE_mod · GitHub

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