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Endogenous discounting via wealth, twin-peaks and the role of technology

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  • Schumacher, Ingmar

Abstract

We endogenize the discount rate via wealth and provide evidence that wealth affects the discount rate negatively. We give a necessary and sufficient condition for endogenous discounting to lead to the Twin-peaks of economic growth and show that improvements in technology help avoid them.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 103 (2009)
Issue (Month): 2 (May)
Pages: 78-80

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Handle: RePEc:eee:ecolet:v:103:y:2009:i:2:p:78-80

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Web page: http://www.elsevier.com/locate/ecolet

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Keywords: Endogenous discounting Twin-peaks of economic growth Multiple equilibria;

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Cited by:
  1. Borissov, Kirill, 2013. "Growth and distribution in a model with endogenous time preferences and borrowing constraints," Mathematical Social Sciences, Elsevier, vol. 66(2), pages 117-128.
  2. Ingmar Schumacher, 2013. "The endogenous formation of an environmental culture," Working Papers hal-00834151, HAL.
  3. Ingmar, SCHUMACHER, 2006. "On optimality, endogeneous discounting and wealth accumulation," Discussion Papers (ECON - Département des Sciences Economiques) 2006058, Université catholique de Louvain, Département des Sciences Economiques.
  4. Strulik, Holger, 2013. "Limited self-control and long-run growth," Center for European, Governance and Economic Development Research Discussion Papers 181, University of Goettingen, Department of Economics.
  5. Strulik, Holger, 2013. "Hyperbolical discounting and endogenous growth," Center for European, Governance and Economic Development Research Discussion Papers 175, University of Goettingen, Department of Economics.
  6. Schumacher, Ingmar, 2011. "Endogenous discounting and the domain of the felicity function," Economic Modelling, Elsevier, vol. 28(1), pages 574-581.
  7. Strulik, Holger, 2012. "Patience and prosperity," Journal of Economic Theory, Elsevier, vol. 147(1), pages 336-352.
  8. Kirill Borissov, 2013. "The existence of equilibrium paths in an AK-model with endogenous time preferences and borrowing constraints," EUSP Deparment of Economics Working Paper Series Ec-01/13, European University at St. Petersburg, Department of Economics.
  9. Sebastian Vollmer & Hajo Holzmann & Florian Schwaiger, 2013. "Peak vs Components," Review of Development Economics, Wiley Blackwell, vol. 17(2), pages 352-364, 05.
  10. Yanase, Akihiko, 2011. "Impatience, pollution, and indeterminacy," Journal of Economic Dynamics and Control, Elsevier, vol. 35(10), pages 1789-1799, October.
  11. repec:ipg:wpaper:13 is not listed on IDEAS

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