Showing 1 - 10 of 23
Rational expectations do not require beliefs to be consistent with history and with what agents can conclude from it. Actually, at a rational expectations equilibrium agents may hold beliefs that explain poorly the history they observe, even when restricted to only those rationalizing their...
Persistent link: https://www.econbiz.de/10011246314
We consider in this paper overlapping generations economies with pollution resulting from both consumption and production. The competitive equilibrium steady state is compared to the optimal steady state from the social planner's viewpoint. We show that the dynamical inefficiency of competitive...
Persistent link: https://www.econbiz.de/10010610458
For an overlapping generations economy with varying life-cycle productivity, non-stationary endowments, continuous time starting at _∞ (hence allowing for full anticipation), constant-returns-to-scale production and CES utility we fully characterise equilibria where output is higher than...
Persistent link: https://www.econbiz.de/10010610460
For a given technology, two ways are available to achieve low polluting emissions: reducing production per capita or reducing population size. This paper insists on the tension between the former and the latter. Controlling pollution either through Pigovian taxes or through tradable quotas...
Persistent link: https://www.econbiz.de/10010610468
The main result is that the golden rule equilibrium (GRE) is Pareto optimal (in the classical sense) in an overlapping generations (OG) model with constant-returns-to-scale production, transfers, arbitrary life-time productivity and CES instantaneous felicity. In addition, we extend Cass and...
Persistent link: https://www.econbiz.de/10010610469
We explore the optimal fertility age-pattern in a four-period OLG economy with physical capital accumulation. For that purpose, we firstly compare the dynamics of two closed economies, Early and Late Islands, which differ only in the timing of births. On Early Island, children are born from...
Persistent link: https://www.econbiz.de/10010610502
In an exogenous-growth economy with overlapping generations (OG) we analyse local stability of the balanced growth equilibria with respect to perturbations of consumption endowments, thought of as the "monetised" value of a government policy to individuals. We show that perturbed economies have...
Persistent link: https://www.econbiz.de/10008550189
Both environmental quality and health care expenditure are determinants of health and life expectancy, but the support for them appears to be different according to the electors' age, with a relatively larger support for health expenditure among the elderly as it is generally effective on a...
Persistent link: https://www.econbiz.de/10008550193
We develop an overlapping generations model of growth and the environment with public policy on education. Beyond the traditional mechanisms through which knowledge, growth and the environment interplay, we stress out the role played by education on environmental awareness. Assuming first that...
Persistent link: https://www.econbiz.de/10008550240
This paper establishes, in the context of the Diamond (1965) overlapping generations economy with production, that the risk that savings in unbacked assets (like fiat money or public debt) become worthless implies that, not only the first-best steady state, but even the best steady state...
Persistent link: https://www.econbiz.de/10008550244