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On the Nature of Suppes-Sen Choice Functions in an Aggregative Growth Model

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  • Dubey, Ram Sewak

    (Cornell University)

  • Mitra, Tapan

    (Cornell University)

Abstract

This paper investigates the nature of paths in the standard neoclassical aggregative model of economic growth that are maximal according to the Suppes-Sen grading principle. This is accomplished by relating such paths to paths which are utilitarian maximal when an increasing (but not necessarily concave) utility function evaluates each period's consumption. An example is presented in which an explicit form of a consumption function is described, which generates only Suppes-Sen maximal paths. This consumption function is shown to generate consumption cycles, and violate the Pigou-Dalton transfer principle.

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Bibliographic Info

Paper provided by Cornell University, Center for Analytic Economics in its series Working Papers with number 10-06.

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Date of creation: Sep 2010
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Handle: RePEc:ecl:corcae:10-06

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