Uniqueness of Markov equilibrium in stochastic OLG models with nonclassical production
AbstractThis paper studies Markov Equilibria (ME) corresponding to recursive equilibria on natural state space in the stochastic OLG model extended to include non-additive utility, nonclassical production, and Markovian production shocks. Specifically, we provide sufficient conditions under which the ME in unique. It turns out that uniqueness for a large class of economies and that restrictions either on the consumption side or the production side alone are sufficient to garantuee this result. We also discuss additional properties such as continuity or smoothness of the equilibrium mappings and whether additional recursive or non-recursive euilibria exist. --
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Bibliographic InfoPaper provided by Karlsruhe Institute of Technology (KIT), Department of Economics and Business Engineering in its series Working Paper Series in Economics with number 46.
Date of creation: 2012
Date of revision:
Markov equilibrium : Uniqueness; Overlapping generations; Nonclassical production; Markovian production shocks;
Find related papers by JEL classification:
- C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
- 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-2012-12-10 (All new papers)
- NEP-DGE-2012-12-10 (Dynamic General Equilibrium)
- NEP-MIC-2012-12-10 (Microeconomics)
- NEP-ORE-2012-12-10 (Operations Research)
- NEP-UPT-2012-12-10 (Utility Models & Prospect Theory)
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