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Recursive Utility and Thompson Aggregators, II: Uniqueness of the Recursive Utility Representation

Author

Listed:
  • Robert Becker

    (Indiana University)

  • Juan Pablo Rincon-Zapatero

    (Universidad Carlos III de Madrid)

Abstract

We reconsider the theory of Thompson aggregators proposed by Mari-nacci and Montrucchio [30]. We demonstrate the Koopmans equation has a unique utility function solution given a Thompson aggregator. Uniqueness holds only on the interior of the commodity spaces positive cone. Our proof veries the Koopmans operator is a u0 concave operator. We verify this using general sufficient conditions due to Liang, et al [28]. Previous published results apply variants of the contraction mapping theorem to the space of possibly utility functions endowed with the Thompson metric. Concave operator methods work on the possible utility function space with its norm topology. Our approach combines order and metric structures to demonstrate uniqueness differently than in the existing literature.

Suggested Citation

  • Robert Becker & Juan Pablo Rincon-Zapatero, 2018. "Recursive Utility and Thompson Aggregators, II: Uniqueness of the Recursive Utility Representation," CAEPR Working Papers 2018-008, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
    • Handle: RePEc:inu:caeprp:2018008
    as

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    File URL: https://caepr.indiana.edu/RePEc/inu/caeprp/caepr2018-008.pdf
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    References listed on IDEAS

    as
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    2. V. Filipe Martins-da-Rocha & Yiannis Vailakis, 2013. "Fixed point for local contractions: Applications to recursive utility," International Journal of Economic Theory, The International Society for Economic Theory, vol. 9(1), pages 23-33, March.
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    8. Robert Becker & Juan Pablo Rincon-Zapatero, 2018. "Recursive Utility and Thompson Aggregators, I: Constructive Existence Theory for the Koopmans Equation," CAEPR Working Papers 2018-006, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
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    More about this item

    Keywords

    Recursive Utility; Thompson Aggregators; Koopmans Equation; u0 – Concave Operator Theory;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

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