Uniqueness of steady states in models with overlapping generations

Felix Kubler*, Karl H Schmedders

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

3 Scopus citations

Abstract

In this paper we examine the likelihood of multiple real steady states in deterministic exchange economies with overlapping generations. There is a single good and a single agent per generation with constant relative risk aversion expected utility. In order to test for multiple equilibria we employ methods from computational algebraic geometry. In our examples, we find that multiplicity becomes less likely as the life span of agents increases but becomes more likely as the coefficient of risk aversion increases. For moderate values of risk aversion, multiplicity is very unlikely when agents live for five or more periods.

Original languageEnglish (US)
Pages (from-to)635-644
Number of pages10
JournalJournal of the European Economic Association
Volume8
Issue number2-3
DOIs
StatePublished - Jan 1 2010

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

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