Allais-anonymity as an alternative to the discounted-sum criterion in the calculus of optimal growth I: Consensual optimality

Mohamed BenRida Mabrouk ()

MPRA Paper from University Library of Munich, Germany

Abstract: The objective of this work is to try to define and calculate the optimal growth path, in the presence of exogenous technical change, without resorting to the discounted-sum criterion. The solution suggested is to consider an optimality criterion expressing an Allais-anonymous intergenerational consensus. The partial characterization of consensual optimality was made possible thanks to the decomposition of the dual of the space of sub-geometric sequences of reason p. The main finding is a relation between the marginal rate of substitution between bequest and heritage, and the growth rate, relation which is a necessary condition for consensual optimality. The necessary study of the Pareto-optimality of the consensual optimum is the subject of a forthcoming paper "Allais-anonymity as an alternative to the discounted-sum criterion in the calculus of optimal growth II: Pareto optimality and some economic interpretations".

Keywords: Intergenerational anonymity; Intergenerational equity; Optimal growth; Technical change; Time-preference; Discounted-sum criterion; Consensual criterion; OG economy. (search for similar items in EconPapers)
JEL-codes: O41 D71 D63 O30 D90 C61 (search for similar items in EconPapers)
Date: 2006-04-07
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