We consider a general model of pure exchange economies with consumption externalities. Households may have different consumption sets and each consumption set is described by a function called possibility function. Utility and possibility functions depend on the consumptions of all households....

In the presence of endogenous growth intergenerational transfer from the young to the old reduce per capita income growth and harm future generations. On the other hand, competitive equilibria are inefficient if externalities sustain long-run growth. This paper shows that if individuals retire...