Can Heterogeneous Preferences Stabilize Endogenous Fluctuations?
While most of the literature concerned with indeterminacy considers a representative agent, some recent works have investigated the role of heterogenous agents on dynamics. This paper adds a contribution to the debate, stressing the effects of heterogeneity in consumers’ preferences within an overlapping generations economy with capital accumulation and consumption in both periods. We show that such an heterogeneity can stabilize fluctuations in many cases, by simply reducing the range of parameters compatible with indeterminacy.
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- Christian Ghiglino & Mich Tvede, 1993.
"Endowments, Stability and Fluctuations in OG Models,"
Research Papers by the Institute of Economics and Econometrics, Geneva School of Economics and Management, University of Geneva
93.04, Institut d'Economie et Econométrie, Université de Genève.
- Ghiglino, Christian & Tvede, Mich, 1995. "Endowments, stability, and fluctuations in OG models," Journal of Economic Dynamics and Control, Elsevier, vol. 19(3), pages 621-653, April.
- Christian Ghiglino & Marielle Olszak-Duquenne, 2005.
"On The Impact Of Heterogeneity On Indeterminacy,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 46(1), pages 171-188, 02.
- Christian Ghiglino & Marielle Olszak-Duquenne, 2004. "On the Impact of Heterogeneity on Indeterminacy," Research Papers by the Institute of Economics and Econometrics, Geneva School of Economics and Management, University of Geneva 2004.09, Institut d'Economie et Econométrie, Université de Genève.
- Ghiglino, Christian & Sorger, Gerhard, 2002. "Poverty Traps, Indeterminacy, and the Wealth Distribution," Journal of Economic Theory, Elsevier, vol. 105(1), pages 120-139, July.
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