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Equilibrium dynamics in a class of one-sector endogenous growth models with external habits: An application of special functions

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  • Gómez, Manuel A.

Abstract

This paper analyzes the equilibrium dynamics in a class of one-sector endogenous growth models with external habits. Using an explicit solution expressed in terms of the Gauss hypergeometric function, we show that the levels of consumption, habits and capital may exhibit non-monotonic transition dynamics, even though their ratios converge monotonically. A numerical simulation illustrates this result.

Suggested Citation

  • Gómez, Manuel A., 2014. "Equilibrium dynamics in a class of one-sector endogenous growth models with external habits: An application of special functions," Journal of Mathematical Economics, Elsevier, vol. 51(C), pages 50-54.
  • Handle: RePEc:eee:mateco:v:51:y:2014:i:c:p:50-54
    DOI: 10.1016/j.jmateco.2014.03.001
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