Advanced Search
MyIDEAS: Login to save this article or follow this journal

Recursive utility and optimal growth with bounded or unbounded returns

Contents:

Author Info

  • Le Van, Cuong
  • Vailakis, Yiannis

Abstract

In this paper we propose a unifying approach to the study of recursive economic problems. Postulating an aggregator function as the fundamental expression of tastes, we explore conditions under which a utility function can be constructed. We also modify the usual dynamic programming arguments to include this class of models. We show that Bellman's equation still holds, so many results known for the additively separable case can be generalized for this general description of preferences. Our approach is general, allowing for both bounded and unbounded (above/below) returns. Many recursive economic models, including the standard examples studied in the literature, are particular cases of our setting.

(This abstract was borrowed from another version of this item.)

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/B6WJ3-4F0853B-1/2/c4a71e6f1784865aa749fcdac0852f5e
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 123 (2005)
Issue (Month): 2 (August)
Pages: 187-209

as in new window
Handle: RePEc:eee:jetheo:v:123:y:2005:i:2:p:187-209

Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/622869

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Streufert, Peter A, 1990. "Stationary Recursive Utility and Dynamic Programming under the Assumption of Biconvergence," Review of Economic Studies, Wiley Blackwell, vol. 57(1), pages 79-97, January.
  2. Epstein, Larry G., 1983. "Stationary cardinal utility and optimal growth under uncertainty," Journal of Economic Theory, Elsevier, vol. 31(1), pages 133-152, October.
  3. Boud, John III, 1990. "Recursive utility and the Ramsey problem," Journal of Economic Theory, Elsevier, vol. 50(2), pages 326-345, April.
  4. Le Van, Cuong & Morhaim, Lisa, 2002. "Optimal Growth Models with Bounded or Unbounded Returns: A Unifying Approach," Journal of Economic Theory, Elsevier, vol. 105(1), pages 158-187, July.
  5. Robert E. Lucas Jr. & Nancy L. Stokey, 1982. "Optimal Growth with Many Consumers," Discussion Papers 518, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  6. Jorge Durán, 2003. "Discounting long run average growth in stochastic dynamic programs," Economic Theory, Springer, vol. 22(2), pages 395-413, 09.
  7. Alvarez, Fernando & Stokey, Nancy L., 1998. "Dynamic Programming with Homogeneous Functions," Journal of Economic Theory, Elsevier, vol. 82(1), pages 167-189, September.
  8. Epstein, Larry G & Zin, Stanley E, 1989. "Substitution, Risk Aversion, and the Temporal Behavior of Consumption and Asset Returns: A Theoretical Framework," Econometrica, Econometric Society, vol. 57(4), pages 937-69, July.
  9. Juan Pablo RincÛn-Zapatero & Carlos RodrÌguez-Palmero, 2003. "Existence and Uniqueness of Solutions to the Bellman Equation in the Unbounded Case," Econometrica, Econometric Society, vol. 71(5), pages 1519-1555, 09.
  10. Dana, Rose-Anne & Van, Cuong Le, 1991. "Optimal growth and Pareto optimality," Journal of Mathematical Economics, Elsevier, vol. 20(2), pages 155-180.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. repec:hal:cesptp:hal-00294828 is not listed on IDEAS
  2. Hyun Park, 2008. "Endogenous Equilibrium Growth With Recursive Preferences And Increasing Returns," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 33(2), pages 167-188, December.
  3. repec:hal:wpaper:hal-00294828 is not listed on IDEAS
  4. Mohamed Mabrouk, 2005. "Intergenerational anonymity as an alternative to the discounted- sum criterion in the calculus of optimal growth I: Consensual optimality," GE, Growth, Math methods 0510013, EconWPA.
  5. Cuong Le Van & Lisa Morhaim & Yiannis Vailakis, 2008. "Monotone concave operators: An application to the existence and uniqueness of solutions to the Bellman equation," Discussion Papers 0803, Exeter University, Department of Economics.
  6. Mohamed Mabrouk, 2005. "Intergenerational anonymity as an alternative to the discounted- sum criterion in the calculus of optimal growth II: Pareto optimality and some economic interpretations," GE, Growth, Math methods 0511007, EconWPA.
  7. Jaśkiewicz, Anna & Matkowski, Janusz & Nowak, Andrzej S., 2011. "On Variable Discounting in Dynamic Programming: Applications to Resource Extraction and Other Economic Models," MPRA Paper 31069, University Library of Munich, Germany, revised 24 May 2011.
  8. Marinacci, Massimo & Montrucchio, Luigi, 2010. "Unique solutions for stochastic recursive utilities," Journal of Economic Theory, Elsevier, vol. 145(5), pages 1776-1804, September.
  9. Matkowski, Janusz & Nowak, Andrzej S., 2008. "On Discounted Dynamic Programming with Unbounded Returns," MPRA Paper 12215, University Library of Munich, Germany.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eee:jetheo:v:123:y:2005:i:2:p:187-209. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.