Endogenous Growth with Intertemporally Dependent Preferences

Ferraguto Giuseppe () and Patrizio Pagano ()
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Ferraguto Giuseppe: Bocconi University

The B.E. Journal of Macroeconomics, 2003, vol. 3, issue 1, 40

Abstract: This paper presents an endogenous growth model with intertemporally dependent preferences and "Ak" technology. We derive sufficient conditions for a balanced growth path to be an equilibrium, provide a full characterization of the equilibrium dynamics of the economy, and explore the implications of habit formation for the patterns of cross-country growth and convergence. Finally, we show that the alternative departure from the standard assumption of isoelastic preferences represented by the use of a Stone-Geary utility function can be interpreted as a special case of the model with habit formation. Our results highlight the importance of preferences in the dynamics of growth, a point neglected in most of the literature.

Keywords: Preferences; Habits; Growth (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (6)

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Working Paper: Endogenous Growth with Intertemporally Dependent Preferences (2000)
Working Paper: Endogenous Growth with Intertemporally Dependent Preferences (2000)
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DOI: 10.2202/1534-6005.1128

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