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Periodic Solutions of the One-sector Growth Model: The Role of Income Effects

Author

Listed:
  • Kazumichi Iwasa

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)

  • Gerhard Sorger

    (Department of Economics, University of Vienna, Austria)

Abstract

The discrete-time version of the neoclassical one-sector growth model with elastic labor supply is considered. It is shown that this model can have periodic solutions only if leisure is an inferior good.

Suggested Citation

  • Kazumichi Iwasa & Gerhard Sorger, 2018. "Periodic Solutions of the One-sector Growth Model: The Role of Income Effects," Discussion Paper Series DP2018-10, Research Institute for Economics & Business Administration, Kobe University.
    • Handle: RePEc:kob:dpaper:dp2018-10
    as

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    File URL: https://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2018-10.pdf
    File Function: First version, 2018
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    References listed on IDEAS

    as
    1. Grandmont, Jean-Michel, 1985. "On Endogenous Competitive Business Cycles," Econometrica, Econometric Society, vol. 53(5), pages 995-1045, September.
    2. Takashi Kamihigashi, 2015. "Multiple interior steady states in the Ramsey model with elastic labor supply," International Journal of Economic Theory, The International Society for Economic Theory, vol. 11(1), pages 25-37, March.
    3. Paul Beaudry & Dana Galizia & Franck Portier, 2020. "Putting the Cycle Back into Business Cycle Analysis," American Economic Review, American Economic Association, vol. 110(1), pages 1-47, January.
    4. Gerhard Sorger, 2018. "Cycles and chaos in the one-sector growth model with elastic labor supply," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(1), pages 55-77, January.
    5. Boldrin, Michele & Woodford, Michael, 1990. "Equilibrium models displaying endogenous fluctuations and chaos : A survey," Journal of Monetary Economics, Elsevier, vol. 25(2), pages 189-222, March.
    6. Eric W. Bond & Kazumichi Iwasa & Kazuo Nishimura, 2012. "The dynamic Heckscher–Ohlin model: A diagrammatic analysis," International Journal of Economic Theory, The International Society for Economic Theory, vol. 8(2), pages 197-211, June.
    7. repec:cup:cbooks:9781107083295 is not listed on IDEAS
    8. de Hek, Paul A., 1998. "An aggregative model of capital accumulation with leisure-dependent utility," Journal of Economic Dynamics and Control, Elsevier, vol. 23(2), pages 255-276, September.
    9. Kydland, Finn E & Prescott, Edward C, 1982. "Time to Build and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 50(6), pages 1345-1370, November.
    10. Michal Kalecki, 1937. "A Theory of the Business Cycle," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 4(2), pages 77-97.
    11. Sorger,Gerhard, 2015. "Dynamic Economic Analysis," Cambridge Books, Cambridge University Press, number 9781107443792.
    12. Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
    13. Day, Richard H, 1982. "Irregular Growth Cycles," American Economic Review, American Economic Association, vol. 72(3), pages 406-414, June.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Goenka, Aditya & Nguyen, Manh-Hung, 2020. "General existence of competitive equilibrium in the growth model with an endogenous labor–leisure choice," Journal of Mathematical Economics, Elsevier, vol. 91(C), pages 90-98.

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    More about this item

    Keywords

    Optimal growth; Elastic labor supply; Periodic solutions; Inferiority of leisure;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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