Intergenerational anonymity as an alternative to the discounted- sum criterion in the calculus of optimal growth II: Pareto optimality and some economic interpretationsGE, Growth, Math methods from EconWPA Abstract: This paper studies the Pareto-optimality of the consensual optimum established in 'Intergenerational anonymity as an alternative to the discounted-sum criterion I: consensual optimality'. For that, a Pareto- optimality criterion is set up by the application of the generalized Karush, Kuhn and Tucker theorem and thanks to the decomposition of the space of subgeometric sequences of reason p. That makes it possible to find sufficient conditions so that a bequest-rule path is Pareto- optimal. Through an example, it is then shown that the golden rule must be checked to achieve anonymous optimality. The introduction of an additive altruism makes it possible to highlight the intergenerational- preference rate compatible with anonymous optimality. In this approach, it is not any more the optimality which depends on the intergenerational-preference rate, but the optimal intergenerational- preference rate which rises from anonymous optimality. Keywords: Intergenerational anonymity; Intergenerational equity; Optimal growth; Technical change; Time-preference; Discounted-sum criterion; Consensual criterion; Pareto-optimality; OG economy (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpge:0511007 Access Statistics for this paper More papers in GE, Growth, Math methods from EconWPA |
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