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Equilibrium price dynamics in an overlapping-generations exchange economy

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  • Brito, Paulo
  • Dilão, Rui

Abstract

An extension to the Yaari (1965)-Blanchard (1985) continuous time overlapping generations model for an endowment Arrow-Debreu economy with an age-structured population is presented. It is proved that Arrow-Debreu equilibrium prices are represented by a double linear integral equation, and depend on the age-distributions of population and endowments. For an economy with a balanced growth, and logarithmic utility, we prove that bubbles may exist if endowments are distributed earlier than some critical age.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Mathematical Economics.

Volume (Year): 46 (2010)
Issue (Month): 3 (May)
Pages: 343-355

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Handle: RePEc:eee:mateco:v:46:y:2010:i:3:p:343-355

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

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Keywords: Overlapping generations models Arrow-Debreu equilibrium McKendrick model Bubbles;

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Citations

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Cited by:
  1. d'Albis, Hippolyte & Augeraud-Véron, Emmanuelle & Schubert, Katheline, 2010. "Demographic-economic equilibria when the age at motherhood is endogenous," Journal of Mathematical Economics, Elsevier, vol. 46(6), pages 1211-1221, November.
  2. d'Albis, Hippolyte & Augeraud-Véron, Emmanuelle, 2009. "Continuous-Time Overlapping Generations Models," TSE Working Papers 09-047, Toulouse School of Economics (TSE).
  3. Sun, Ruoyan, 2013. "Kinetics of jobs in multi-link cities with migration-driven aggregation process," Economic Modelling, Elsevier, vol. 30(C), pages 36-41.
  4. Brito, Paulo, 2008. "Equilibrium asset prices and bubbles in a continuous time OLG model," MPRA Paper 10701, University Library of Munich, Germany.

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