Quantitative aspects of adjustment processes in economic growth remain frequently unsolved or are tackled with bulky or inaccurate methods like multiple shooting or log-linearization. Mulligan's (1991) method of time elimination, however, has improved the analysis of saddle path dynamics in...

We present a non-linear solution method of saddlepoint dynamics in discrete time optimization problems. It is based on the backward attractivity of the stable manifold and is very easy to implement. After an introduction to the general method we present two applications. First we consider the...

Economists frequently confine themselves to the qualitative analysis of continuous optimization problems or they restrict their quantitative analysis to inaccurate methods like linearization around the steady state. The fact that the solution is characterized by an inherently unstable adjustment...

We set up an endogenous growth model with physical capital, human capital and blueprints for intermediate goods. The model can generate steady-state growth or stagnation. Along the adjustment path for a developing economy we can distinguish different stages of development. The first stage is...

This article offers a theory of economic growth, stagnation, and demo-economic transition that originates from external effects of child-bearing, health expenditure, and education under endogenous mortality. Facing a hierarchy of needs, parents always consume and want to have a family. Child...

The paper analyzes an economy with an agrarian and an industrial sector. Demand is determined by Engel's Law. Population growth follows a non--linear income dependent path according to the theory of demographic transition. In case of decreasing returns to scale in the agrarian sector the...

The paper analyses the long-run equilibrium and adjustment dynamics in models of economic growth where property rights are absent. A comparison with the standard models assesses the importance of property rights quantitatively. In the neoclassical growth model individuals arrive at a lower...

The paper investigates an economy where parents observe wage rates, interest rates, and child mortality and decide about savings and the quantity and quality of their children. Expenditure on child quality causes human capital accmulation as an external effect. If mortality is high parents...

This paper analyses the long-run effects of Estonia’s 2000 Income Tax Act with a dynamic general equilibrium model. Specifically, we consider the impact of the shift from an imputation system to one where companies only pay taxes on distributed profits. Balanced growth paths, transitional...

Recent empirical studies have revealed a strong impact of tax changes on corporate finance. Yet, models of economic growth usually neglect financial structure of the representative firm. In order to investigate whether the consideration of firm finance modifies the estimated outcome of capital...