Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers

Jean François Mertens; Anna Rubinchik

doi:10.1017/S1365100514000108

Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers

Jean François Mertens, Anna Rubinchik

Department of Economics

Research output: Contribution to journal › Article › peer-review

Abstract

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 homogeneous instantaneous felicity. In addition, we extend Cass and Yaari's equivalence between efficiency (aggregate consumption dominance) and present value dominance (with evaluation made using a candidate equilibrium price path).

Original language	English
Pages (from-to)	1780-1799
Number of pages	20
Journal	Macroeconomic Dynamics
Volume	19
Issue number	8
DOIs	https://doi.org/10.1017/S1365100514000108
State	Published - 30 Apr 2014

Bibliographical note

Publisher Copyright:
© Cambridge University Press 2015.

Keywords

Exogenous Growth
Golden Rule Equilibrium
Infinite Economies
Overlapping Generations

ASJC Scopus subject areas

Economics and Econometrics

Access to Document

10.1017/S1365100514000108

Cite this

@article{ab9d1cb70958434d8698ff784de87c35,

title = "Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers",

abstract = "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 homogeneous instantaneous felicity. In addition, we extend Cass and Yaari's equivalence between efficiency (aggregate consumption dominance) and present value dominance (with evaluation made using a candidate equilibrium price path).",

keywords = "Exogenous Growth, Golden Rule Equilibrium, Infinite Economies, Overlapping Generations",

author = "Mertens, {Jean Fran{\c c}ois} and Anna Rubinchik",

note = "Publisher Copyright: {\textcopyright} Cambridge University Press 2015.",

year = "2014",

month = apr,

day = "30",

doi = "10.1017/S1365100514000108",

language = "English",

volume = "19",

pages = "1780--1799",

journal = "Macroeconomic Dynamics",

issn = "1365-1005",

publisher = "Cambridge University Press",

number = "8",

}

TY - JOUR

T1 - Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers

AU - Mertens, Jean François

AU - Rubinchik, Anna

N1 - Publisher Copyright: © Cambridge University Press 2015.

PY - 2014/4/30

Y1 - 2014/4/30

N2 - 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 homogeneous instantaneous felicity. In addition, we extend Cass and Yaari's equivalence between efficiency (aggregate consumption dominance) and present value dominance (with evaluation made using a candidate equilibrium price path).

AB - 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 homogeneous instantaneous felicity. In addition, we extend Cass and Yaari's equivalence between efficiency (aggregate consumption dominance) and present value dominance (with evaluation made using a candidate equilibrium price path).

KW - Exogenous Growth

KW - Golden Rule Equilibrium

KW - Infinite Economies

KW - Overlapping Generations

UR - http://www.scopus.com/inward/record.url?scp=84947491374&partnerID=8YFLogxK

U2 - 10.1017/S1365100514000108

DO - 10.1017/S1365100514000108

M3 - Article

AN - SCOPUS:84947491374

SN - 1365-1005

VL - 19

SP - 1780

EP - 1799

JO - Macroeconomic Dynamics

JF - Macroeconomic Dynamics

IS - 8

ER -

Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

Access to Document

Other files and links

Fingerprint

Cite this