Global attractor in Solow growth model with differential savings and endogenic labor force growth
In this paper we study the dynamics of a discrete triangular system T in capital per capita and population growth representing the neoclassical growth model with CES production function and differential savings, under the assumption that the labor force growth rate is endogenous and described by a generic iterative scheme having a unique positive globally stable equilibrium. The study herewith presented aims at confirming the existence of a compact global attractor for system T along the invariant line. Consequently asymptotic dynamics of growth models with constant population growth rate can be related to those with non-constant population growth if the steady state rate is globally stable. Furthermore we prove that the system exhibits cycles or even chaotic dynamics patterns if shareholders save more than workers, when the elasticity of substitution between production factors drops below one (so that capital income declines). The analytical results are supplemented by numerical simulations.
|Date of creation:||Oct 2006|
|Date of revision:||Oct 2008|
|Publication status:||Forthcoming in AMSE periodicals, Modelling Measurement and Control.|
|Contact details of provider:|| Postal: |
Web page: http://www.unimc.it/dief
More information through EDIRC
References listed on IDEAS
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.:
- Becker, Robert A & Foias, Ciprian, 1994.
"The Local Bifurcation of Ramsey Equilibrium,"
Springer, vol. 4(5), pages 719-44, August.
- Stiglitz, Joseph E, 1969.
"Distribution of Income and Wealth among Individuals,"
Econometric Society, vol. 37(3), pages 382-97, July.
- Joseph E. Stiglitz, 1967. "Distribution of Income and Wealth Among Individuals," Cowles Foundation Discussion Papers 238, Cowles Foundation for Research in Economics, Yale University.
- Brianzoni Serena & Mammana Cristiana & Michetti Elisabetta, 2007. "Complex Dynamics in the Neoclassical Growth Model with Differential Savings and Non-Constant Labor Force Growth," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 11(3), pages 1-19, September.
- Elvio Accinelli & Juan Gabriel Brida, 2005. "Re-formulation of the Solow economic growth model whit the Richards population growth law," GE, Growth, Math methods 0508006, EconWPA.
- Bohm, Volker & Kaas, Leo, 2000. "Differential savings, factor shares, and endogenous growth cycles," Journal of Economic Dynamics and Control, Elsevier, vol. 24(5-7), pages 965-980, June.
- Swan, Trevor W, 2002. "Economic Growth," The Economic Record, The Economic Society of Australia, vol. 78(243), pages 375-80, December.
- T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
- Hommes, Cars H., 1994. "Dynamics of the cobweb model with adaptive expectations and nonlinear supply and demand," Journal of Economic Behavior & Organization, Elsevier, vol. 24(3), pages 315-335, August.
When requesting a correction, please mention this item's handle: RePEc:mcr:wpdief:wpaper00035. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Silvana Tartufoli)
If references are entirely missing, you can add them using this form.