This paper analyses the optimal timing of switching between alternative and consecutive regimes in optimal growth models. We derive the appropriate necessary conditions for such problems by means of the standard techniques from calculus of variations and some basic properties of Sobolev spaces.

In a developing country with three sectors: consumption goods, new tech- nology, and education, the productivity of the consumption goods depends on a new technology and skilled labor used to produce this new technology. There can be three stages of economic growth. In the …rst stage the...

This paper describes the multisectoral macroeconomic model of a small developing economy in transition, in order to highlight linkages between agriculture and the rest of the economy, and consequences of external opening up. Agriculture is a supply sector, sticky in the short range with market...

In this paper, we make use of the Sobolev space W1,1(R+, Rn) to derive at once the Pontryagin conditions for the standard optimal growth model in continuous time, including a necessary and sufficient transversality condition. An application to the Ramsey model is given. We use an order ideal...

We introduce a no-risky-arbitrage price condition (NRAP) for asset market models allowing both unbounded short sales and externalities such as trading volume. We then demonstrate that NRAP is sufficient for the existence of competitive equilibrium in the presence ofexternalities. Moreover, we...

This paper studies the optimal growth of a developing non-renewable natural resource producer. It extracts the resource from its soil, and produces a single consumption good with man-made capital. More- over, it can sell the extracted resource abroad and use the revenues to buy an imported good,...

In this paper, we make use of the Sobolev space W1,1 (R+,Rn) toderive at once the Pontryagin conditions for the standard optimalgrowth model in continuous time, including a necessary and sufficienttransversality condition. An application to the Ramsey model is given.We use an order ideal...

There are two main approaches for defining social welfare relations for an economy with infinite horizon. The first one is to consider the set of intertemporal utility streams generated by a general set of bounded consumptions and define a preference relation between them. This relation is...

For Markovian economic models, long-run equilibria are typically identified with the stationary (invariant) distributions generated by the model. In this paper weprovide new sufficient conditions for continuity in the map from parameters to these equilibria. Several existing results are shown to...

Most of the international asset pricing models are developed in the situation where purchasing power parity (PPP) is not respected. Investors of different countries do not agree on expected security returns. However, in this case, an equilibrium on the international assets market may exist but...