Indeterminacy Under Constant Returns to Scale in Multisector Economies
The purpose of this paper is to characterize the possibility of indeterminacy in multisector growth models that exhibit constant marginal returns to scale at the social level, with empirically realistic small external effects. Our results demonstrate that indeterminacy does not require increasing returns to scale, large external effects, or close to linear utility functions. A small divergence between the social and private returns is sufficient for multiple equilibria.
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Danyang Xie, 2002.
"Divergence in Economic Performance: Transitional Dynamics with Multiple Equilibria,"
GE, Growth, Math methods
- Xie Danyang, 1994. "Divergence in Economic Performance: Transitional Dynamics with Multiple Equilibria," Journal of Economic Theory, Elsevier, vol. 63(1), pages 97-112, June.
- Eric W. Bond & Ping Wang & Chong K. Yip, 1993.
"A general two-sector model of endogenous growth with human and physical capital: balanced growth and transitional dynamics,"
9324, Federal Reserve Bank of Dallas.
- Bond, Eric W. & Wang, Ping & Yip, Chong K., 1996. "A General Two-Sector Model of Endogenous Growth with Human and Physical Capital: Balanced Growth and Transitional Dynamics," Journal of Economic Theory, Elsevier, vol. 68(1), pages 149-173, January.
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