#Equivalent variation
#==============================================Announced
EV1<-rep(0,T) #inicialization

t0<-timeR-10

for (t1 in (timeR-5):(timeR+20)){

a<--0.5
b<-0.5

repeat{
e<-(a+b)/2


s[t0]<-(w[t0]*(1+e)*(1-tau[t0])-(1+rho)/(1+r[t0+1])*w[t0+1]*(1+e)*tau[t0+1]*(1+n[t0+1]))/(2+rho)

C_y[t0]<-(1-tau[t0])*w[t0]*(1+e)-s[t0]
C_o[t0]<-(1+r[t0])*s[t0-1]+tau[t0]*w[t0]*(1+e)*(1+n[t0])

U5<-log(C_y[t0])+log(C_o[t0+1])/(1+rho)

if (U5<U1[t1]) a<-e else b<-e
if (abs(U5-U1[t1])<eps) break

}

EV1[t1]<-e

}


plot(EV1[95:110], col=j, type="l")

#=============================================Unannounced

EV2<-rep(0,T) #inicialization


for (t1 in (timeR-5):(timeR+20)){

a<--0.5
b<-0.5

repeat{
e<-(a+b)/2


s[t0]<-(w[t0]*(1+e)*(1-tau[t0])-(1+rho)/(1+r[t0+1])*w[t0+1]*(1+e)*tau[t0+1]*(1+n[t0+1]))/(2+rho)

C_y[t0]<-(1-tau[t0])*w[t0]*(1+e)-s[t0]
C_o[t0]<-(1+r[t0])*s[t0-1]+tau[t0]*w[t0]*(1+e)*(1+n[t0])

U5<-log(C_y[t0])+log(C_o[t0+1])/(1+rho)

if (U5<U2[t1]) a<-e else b<-e
if (abs(U5-U2[t1])<eps) break

}

EV2[t1]<-e

}


plot(EV2[95:110], col=j, type="l")


#====================================================plots



index<-c(-2:6)

plot(index,EV2[98:106], type="l",xlab="generations",ylab="Equivalent variation", yaxt="n")

axis(2, at=pretty(EV2), lab=paste0(pretty(EV2) * 100, " %"), las=TRUE)


lines(index,EV1[98:106], lty=2)


legend("bottomright",  c("announced reform", "unannounced reform"), col = c(1,1), lty = 1:2)