Global analysis of the growth and cycles of multi-sector economies with constant returns: A turnpike approach
AbstractIn Section 1, we explain the neoclassical optimal growth model, which includes multi capital goods, and is derived from neoclassical production functions; the transformations to the reduced model are also explained. Section 2 pertains to the explanation of the methods for proving the consumption turnpike theorem demonstrated by Scheinkman (1976) and McKenzie (1983). Also, the case in which the essentials of the von Neumann-McKenzie facet, which plays an important role in the next part, became a two-sector model and is explained using figures. In Section 3, we postulate a two-sector neoclassical optimal growth model, and the optimal path behavior in the vicinity of the optimal steady state path (modified golden rule path) are classified using the characteristics of von Neumann-McKenzie facet. Also, we will use these results to prove, based on a weaker hypothesis, that the theorem that the optimal path local stability and the optimal path attained by Benhabib and Nishimura（1985）becomes a two-term periodic solution. In Section 4, the generalization of the global asymptotic stability conclusion achieved with two divisions into a case that includes two or more types of capital goods. In Addendum, the important fundamental principles used in the main text will be defined, and a number of theorems will be proved.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 24860.
Date of creation: Jun 2010
Date of revision: Jun 2010
multi-sector model; turnpike theory; optimal growth; the Neumann-McKednzie facet;
Find related papers by JEL classification:
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- O21 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-09-18 (All new papers)
- NEP-DGE-2010-09-18 (Dynamic General Equilibrium)
- NEP-FDG-2010-09-18 (Financial Development & Growth)
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