Optimal Growth when Tastes are Inherited

We address the issue of optimal growth when standard-of-living aspirations are transmitted from one generation to the next. We derive the condition for the optimal solution to be stable in the saddle-point sense and show that this optimal solutionmay display damped oscillations even when the planner does not discount the utility of future generations (golden rule case).

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Year of publication:	1997
Authors:	De La Croix, D. ; Michel, P.
Institutions:	Association of Southern European Economic Theorists - ASSET
Subject:	EXTERNALITIES \| INVESTMENTS \| SUBSIDIES

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Series:	ASSET - Instituto De Economia Publica.
Type of publication:	Book / Working Paper
Notes:	16 pages
Classification:	E32 - Business Fluctuations; Cycles ; O41 - One, Two, and Multisector Growth Models
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005474443