Recursive Competitive Equilibrium

"Formally, a Recursive Competitive Equilibrium (RCE) is characterized by time invariant functions of a limited number of ‘state variables’, which summarize the effects of past decisions and current information.

These functions (decision rules) include

(a) a pricing function, 

(b) a value function,

(c) a period allocation policy specifying the individual’s decision,

(d) period allocation policy specifying the decision of each firm and

(e) a function specifying the law of motion of the capital stock."

Mehra 2005 "Recursive Competitive Equilibrium"
www.academicwebpages.com/preview/mehra/pdf/REC Nov 9.pdf