Solving the non-convexity problem in some shopping-time and human-capital models
Several works in the shopping-time and in the human-capital literature, due to the nonconcavity of the underlying Hamiltonian, use Örst-order conditions in dynamic optimization to characterize necessity, but not su¢ ciency, in intertemporal problems. In this work I choose one paper in each one of these two areas and show that optimality can be characterized by means of a simple aplication of Arrowís (1968) su¢ ciency theorem.
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- Lucas, Robert E, Jr, 1990. "Supply-Side Economics: An Analytical Review," Oxford Economic Papers, Oxford University Press, vol. 42(2), pages 293-316, April.
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2001-5, University of Guelph, Department of Economics and Finance.
- Cysne, Rubens P. & Maldonado, Wilfredo L. & Monteiro, Paulo Klinger, 2005.
"Inflation and income inequality: A shopping-time approach,"
Journal of Development Economics,
Elsevier, vol. 78(2), pages 516-528, December.
- Cysne, Rubens Penha & Maldonado, Wilfredo Fernando Leiva & Monteiro, Paulo Klinger, 2004. "Inflation and income inequality: a shopping-time aproach," Economics Working Papers (Ensaios Economicos da EPGE) 566, FGV/EPGE Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
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- Antonio Ladrón-de-Guevara & Salvador Ortigueira & Manuel S. Santos, 1999. "A Two-Sector Model of Endogenous Growth with Leisure," Review of Economic Studies, Oxford University Press, vol. 66(3), pages 609-631.
- Gillman, M. & Siklos, P.L. & Silver, J.L., 1997.
"Money Velocity with Costly Credit,"
97-4, Wilfrid Laurier University, Department of Economics.
- Rosen, Sherwin, 1976. "A Theory of Life Earnings," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages S45-67, August.
- Cysne, Rubens P, 2003.
" Divisia Index, Inflation, and Welfare,"
Journal of Money, Credit and Banking,
Blackwell Publishing, vol. 35(2), pages 221-38, April.
- Rubens Penha Cysne, 2001. "Divisia Index, Inflation and Welfare," Anais do XXIX Encontro Nacional de Economia [Proceedings of the 29th Brazilian Economics Meeting] 020, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
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