For two independent principles of intergenerational equity, the implied discount rate equals the growth rate of real per capita income, say, 2%, thus falling right into the range suggested by the U.S. Office of Management and Budget. To prove this, we develop a simple tool to evaluate small...

We generalise the classical implicit function theorem (IFT) for a family of Banach spaces, with the resulting implicit function having derivatives that are locally Lipschitz to very strong operator norms.

For an overlapping generations economy with varying life-cycle productivity, non-stationary endowments, continuous time starting at infinity (hence allowing for full anticipation), constant-returns-to-scale production and ces utility we fully characterise equilibria where output is higher than...

In an exogenous-growth economy with overlapping generations we analyse local stability of a balanced growth equilibrium with respect to changes in consumption endowments, which could be interpreted as a transfer policy. We show that generically, in the space of parameters, equilibria around BGE...

Current Office of Management and Budget (OMB) guidelines use the interest rate as a basis for the discount rate, and have nothing to say about an intergenerationally fair discount rate. We derive this discount rate by differentiating a social welfare function with respect to perturbations in...

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...

A necessary condition is time-invariance, which is satisfied by any common solution concept in an overlapping generations model with exogenous growth. The method is applied to derive the discount rate for cost-benefit analysis under two different utilitarian welfare functions: traditional and...

Do greater potential gains from trade enhance or erode contracting institutions? In an anonymous exchange environment traders can sign a contract, hence agreeing to interact with the assigned partner, or wait till the next match. Any contract can be endorsed (for a pay) by the enforcement...

We study the asymptotic nucleolus of a smooth and symmetric oligopoly with an atomless sector. We show that under appropriate assumptions, the asymptotic nucleolus of the TU market game coincides with the unique TU competitive payoff distribution. This equivalence results from nucleolus of a...