% Code adapted from the work of Gualtiero Azzalini (IIES)

clear
close all
clc

%% Part (c)

% generate the grid
run grid

% solve the model
outputloss = 'quadratic';  %the options are 'constant' or 'quadratic'
save loss_spec outputloss

run solveEGVFI

% simulate the model
run simulateEG

% statistics
run statistics

% debt distribution
Figure1 = figure;
bar(d,Ddistr);
xlabel('Debt');
ylabel('%');
title('Debt Distribution')
saveas(Figure1,'dist_quadratic.png')

Figure2 = figure;
plot(ya)
hold on
plot(y,'--')
hold off
xlabel('Grid point (y)')
ylabel('Output')
legend('Autarky', 'Good financial standing', 'Location', 'NorthWest')
saveas(Figure2,'loss_quadratic.png')

% save conditional average to calibrate the constant case
save cond_av loss

%% Part (d)

close all

% solve the model
outputloss = 'constant';  %the options are 'constant' or 'quadratic'
save loss_spec outputloss

run solveEGVFI

% simulate the model
run simulateEG

% statistics
run statistics

% debt distribution
Figure3 = figure;
bar(d,Ddistr);
xlabel('Debt');
ylabel('%');
title('Debt Distribution')
saveas(Figure3,'dist_constant.png')

Figure4 = figure;
plot(ya)
hold on
plot(y,'--')
hold off
xlabel('Grid point (y)')
ylabel('Output')
legend('Autarky', 'Good financial standing', 'Location', 'NorthWest')
saveas(Figure4,'loss_constant.png')

close all