The open-loop solution of the Uzawa-Lucas model of endogenous growth with N agents
AbstractWe solve an player general-sum differential game. The optimization problem considered here is based on the Uzawa-Lucas model of endogenous growth. Agents have logarithmic preferences and own two capital stocks. Since the number of players is an arbitrary fixed number , the model's solution is more general than the idealized concepts of the social planer's solution with one player or the competitive equilibrium with infinitely many players. We show that the symmetric Nash equilibrium is completely described by the solution to a single ordinary differential equation. The numerical results imply that the influence of the externality along the balanced growth path decreases rapidly as the number of players increases. Off the steady state, the externality is of great importance, even for a large number of players.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Macroeconomics.
Volume (Year): 30 (2008)
Issue (Month): 1 (March)
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Web page: http://www.elsevier.com/locate/inca/622617
Other versions of this item:
- Bethmann, Dirk, 2004. "The open-loop solution of the Uzawa-Lucas Model of Endogenous Growth with N agents," Papers 2004,42, Humboldt-Universität Berlin, Center for Applied Statistics and Economics (CASE).
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
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.:
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