Perfect foresight equilibrium trajectories of an overlapping generations model with production may include stable or unstable invariant closed curves. These orbits are detected using the Hopf bifurcation theorem, where the parameter of bifurcation is purely technological. The paper also proves that there is a stabilization policy that completely eliminates the cycle. Finally, using a C.E.S. production function, it is shown that the range of values of the elasticity of substitution between capital and labor for which cycles may exist is bounded above.

Equilibrium cycles in an overlapping generations economy with production / Reichlin, Pietro. - In: JOURNAL OF ECONOMIC THEORY. - ISSN 0022-0531. - 40:(1986), pp. 89-102.

Equilibrium cycles in an overlapping generations economy with production

REICHLIN, PIETRO
1986

Abstract

Perfect foresight equilibrium trajectories of an overlapping generations model with production may include stable or unstable invariant closed curves. These orbits are detected using the Hopf bifurcation theorem, where the parameter of bifurcation is purely technological. The paper also proves that there is a stabilization policy that completely eliminates the cycle. Finally, using a C.E.S. production function, it is shown that the range of values of the elasticity of substitution between capital and labor for which cycles may exist is bounded above.
Equilibrium cycles in an overlapping generations economy with production / Reichlin, Pietro. - In: JOURNAL OF ECONOMIC THEORY. - ISSN 0022-0531. - 40:(1986), pp. 89-102.
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11385/3962
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