Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers
AbstractThe main result is that the golden rule equilibrium (GRE) is Pareto optimal (in the classical sense) in an overlapping generations (OG) model with constant-returns-to-scale production, transfers, arbitrary life-time productivity and CES instantaneous felicity. In addition, we extend Cass and Yaari's  equivalence between efficiency (aggregate consumption dominance) and the present value dominance (with evaluation made using a candidate equilibrium price path).
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Bibliographic InfoPaper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2012033.
Date of creation: 14 Sep 2012
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infinite economies; overlapping generations; exogenous growth; golden rule equilibrium;
Find related papers by JEL classification:
- D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
- E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
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