This paper examines dynamic efficiency in the context of a two-sector overlappinggenerations model. First, conditions for dynamic efficiency in a centrally planned economy arederived. Then, in a competitive environment, the implications of dynamic (in)efficiency for thesteady state relative...

Rejuveniles are "grown-ups who cultivate juvenile tastes in products and entertainment". In this note, we study a standard AK growth model of overlapping generations populated by rejuveniles. For our purposes, rejuveniles are old agents who derive utility from "keeping up" their consumption with...

This paper develops a model in which two information frictions are embedded into an otherwise conventional neoclassical growth model; an adverse selection problem in the labor market and a costly state verification problem in the credit market. The former allows equilibrium unemployment to arise...

Researchers have incorporated labor or credit market frictions in isolation within simple neoclassical models to open up a role for institutions, inject realism into their models and examine the impact of these distortions on output and employment. We present an overlapping generations model...

TTwo equilibrium possibilities are known to obtain in a standard overlapping-generations model with dynastic preferences: either the altruistic bequest motive is operative for every generation (in which case, Ricardian equivalence obtains) or it is not, for any generation. Dynamic equilibria,...