In this paper, we present a dynamic general equilibrium model with two sectors: one aggregate firm produces consumption good and a second one investment good. We assume sector specific as well as aggregate ex- ternalities. Moreover, we account for variable capital utilization i.e. the...

This paper studies a two-sector model with aggregate and sector-specific external effects in production and inelastic labor supply. We first characterize the existence, uniqueness and multiplicity of the steady states as well as their welfare properties. We particularly focus on the CES...

This chapter studies the e¤ect of consumption externalities on stability properties of a Ramsey model with heterogeneous agents and borrowing constraints. Agents di¤er in their initial wealth, felicity functions and discount factors. For simplicity, heterogeneity is reduced to two groups....

This paper aims to study the stability properties of a two-period over- lapping generations model (OLG) with a progressive labor-income taxa- tion rule. In this case, wage income tax rates are increasing with agent's income. Each representative agent lives two periods: youth and adult- hood. In...

We consider a Ramsey model with heterogeneous agents and borrow- ing constraint. Heterogeneity across agents stems from di¤erent initial capital endowment, labor supply, felicity function and discount rate. For simplicity, heterogeneity is reduced to only two groups of agents where they are...