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Rejuveniles and Growth

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  • Richard C. Barnett
  • Joydeep Bhattacharya

    ()
    (School of Economics and Management, University of Aarhus, Denmark)

Abstract

Rejuveniles are "people who cultivate tastes and mind-sets tradi- tionally associated with those younger than themselves." (Noxon, 2006) In this paper, we study a standard AK growth model of overlapping generations populated by rejuve- niles. For our purposes, rejuveniles are old agents who derive utility from "keeping up" their consumption with that of the current young. We find that such cross-generational keeping up is capable of generating interesting equilibrium growth dynamics, including growth cycles. No such growth dynamics is possible either in the baseline model, one where no such generational consumption externality exists, or for almost any other form of keeping up. Steady-state growth in a world with rejuveniles may be higher than that obtained in the baseline model

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Bibliographic Info

Paper provided by School of Economics and Management, University of Aarhus in its series Economics Working Papers with number 2007-11.

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Length: 25
Date of creation: 19 Sep 2007
Date of revision:
Handle: RePEc:aah:aarhec:2007-11

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Web page: http://www.econ.au.dk/afn/

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Keywords: Growth cycles; keeping up preferences; consumption externality;

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References

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  9. Bhattacharya, Joydeep & Russell, Steven, 2002. "Two-Period Cycles in a Three-Period Overlapping Generations Model," Staff General Research Papers 10250, Iowa State University, Department of Economics.
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Cited by:
  1. Barnett, Richard C. & Bhattacharya, Joydeep & Bunzel, Helle, 2013. "Deviant Generations, Ricardian Equivalence, and Growth Cycles," Staff General Research Papers 12939, Iowa State University, Department of Economics.
  2. Monisankar Bishnu, 2011. "Linking consumption externalities with optimal accumulation of human and physical capital and intergenerational transfers," Indian Statistical Institute, Planning Unit, New Delhi Discussion Papers 11-01, Indian Statistical Institute, New Delhi, India.

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