Acemoglu, Daron; Golosov, Michael; Tsyvinski, Aleh - Istituto Einaudi per l'Economia e la Finanza (EIEF) - 2009
We study the constrained Pareto efficient allocations in a dynamic production economy in which the group that holds political power decides the allocation of resources. We show that Pareto efficient allocations take a quasi-Markovian structure and can be represented recursively as a function of...