Fluctuations in Overlapping Generations Economies
AbstractIn the present paper stationary pure-exchange overlapping generations economies with l goods per date and m consumers per generation are considered. It is shown that for an open and dense set of utility functions there exist endowment vectors such that n-cycles exist for n ≤ l +1 and l ≤ m. The approach to existence of endogenous fluctuations is basic in the sense that the prime ingredients are the implicit function theorem and linear algebra. Moreover the approach is applied to show that for an open and dense set of utility functions there exist endowment vectors such that sunspot equilibria, where prices at every date only depends on the state at that date, exist.
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Bibliographic InfoPaper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 09-05.
Length: 17 pages
Date of creation: Mar 2009
Date of revision:
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cycles; overlapping generations economies; sunspot equilibria;
Other versions of this item:
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
- E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-03-28 (All new papers)
- NEP-DGE-2009-03-28 (Dynamic General Equilibrium)
- NEP-MAC-2009-03-28 (Macroeconomics)
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