Uniqueness and Stability of Equilibria in a Model with Endogenous Markups and Labor Supply

Yangru Wu () and Junxi Zhang ()
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Junxi Zhang: School of Economics and Finance, University of Hong Kong

Annals of Economics and Finance, 2003, vol. 4, issue 1, 177-191

Abstract: The presence of public policy in models with multiple steady states is known to be capable of reducing the set of equilibria. This paper shows that in a simple growth model with endogenous markups, introducing an endogenous laborleisure choice also helps eliminate multiple steady state equilibria. Moreover, it alters the stability condition of the unique steady state as well; namely, the steady state may display damped oscillations and admit periodic orbits.

Keywords: Multiple equilibria; Endogenous markups; Endogenous labor supply (search for similar items in EconPapers)
JEL-codes: C62 O40 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:cuf:journl:y:2003:v:4:i:1:p:177-191

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