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Optimal Policy in OG Models

Ghiglino, Christian and Tvede, Mich Optimal Policy in OG Models. [["eprint_typename_scholarly-edition" not defined]]

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Abstract

In the present paper general stationary overlapping generations economies with many commodities in every period and many different consumers in every generation are considered. A government maximizes an utilitarian social welfare function, that is the sum of weighted averages of utilities for generations, through fiscal policy, i.e. monetary transfers and taxes. Both situations with and without time discounting are considered. It is shown that if the discount factor is sufficiently close to one then the optimal policy stabilizes the economy, i.e. the equilibrium path has the turnpike property. Moreover the fiscal policy is shown to be time-consistent.

Item Type: ["eprint_typename_scholarly-edition" not defined]
Uncontrolled Keywords: D51; D91; E32; E52; H20; overlapping generations economies; economic policy; turnpike property; discounting
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences
Faculty of Social Sciences > Economics, Department of
SWORD Depositor: Elements
Depositing User: Elements
Date Deposited: 16 Jul 2012 18:03
Last Modified: 15 Jan 2022 00:40
URI: http://repository.essex.ac.uk/id/eprint/3026

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