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Endogenous discounting via wealth, Twin-Peaks and the role of technology

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  • Ingmar Schumacher

    (Department of Economics, Ecole Polytechnique - CNRS : UMR7176 - Polytechnique - X)

Abstract

We endogenize the discount rate via wealth and provide evidence that wealth affects the discount rate negatively. We give a necessary and sufficient condition for endogenous discounting to lead to the Twin-Peaks of economic growth and show that improvements in technology help avoid them.

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Bibliographic Info

Paper provided by HAL in its series Working Papers with number hal-00356233.

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Date of creation: Jan 2009
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Handle: RePEc:hal:wpaper:hal-00356233

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Keywords: endogenous discounting; Twin-Peaks of economic growth; multiple equilibria.;

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Citations

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Cited by:
  1. repec:ipg:wpaper:13 is not listed on IDEAS
  2. Kirill Borissov, 2013. "The existence of equilibrium paths in an AK-model with endogenous time preferences and borrowing constraints," EUSP Deparment of Economics Working Paper Series, European University at St. Petersburg, Department of Economics Ec-01/13, European University at St. Petersburg, Department of Economics.
  3. Vollmer, Sebastian & Holzmann, Hajo & Schwaiger, Florian, 2010. "Peaks vs. Components," Hannover Economic Papers (HEP) dp-452, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
  4. Strulik, Holger, 2013. "Hyperbolical discounting and endogenous growth," Center for European, Governance and Economic Development Research Discussion Papers 175, University of Goettingen, Department of Economics.
  5. Schumacher, Ingmar, 2011. "Endogenous discounting and the domain of the felicity function," Economic Modelling, Elsevier, vol. 28(1-2), pages 574-581, January.
  6. Strulik, Holger, 2012. "Patience and prosperity," Journal of Economic Theory, Elsevier, vol. 147(1), pages 336-352.
  7. Ingmar, SCHUMACHER, 2006. "On optimality, endogeneous discounting and wealth accumulation," Discussion Papers (ECON - Département des Sciences Economiques), Université catholique de Louvain, Département des Sciences Economiques 2006058, Université catholique de Louvain, Département des Sciences Economiques.
  8. Borissov, Kirill, 2013. "Growth and distribution in a model with endogenous time preferences and borrowing constraints," Mathematical Social Sciences, Elsevier, vol. 66(2), pages 117-128.
  9. Strulik, Holger, 2013. "Limited self-control and long-run growth," Center for European, Governance and Economic Development Research Discussion Papers 181, University of Goettingen, Department of Economics.
  10. Ingmar Schumacher, 2013. "The endogenous formation of an environmental culture," CEEES Paper Series CE3S-04/13, European University at St. Petersburg, Department of Economics.
  11. Yanase, Akihiko, 2011. "Impatience, pollution, and indeterminacy," Journal of Economic Dynamics and Control, Elsevier, vol. 35(10), pages 1789-1799, October.

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