Endogenous fluctuations and public services in a simple OLG economy

Thomas Seegmuller ()
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Thomas Seegmuller: BETA-Theme

Economics Bulletin, 2003, vol. 5, issue 10, 1-7

Abstract: In a simple OLG model, we introduce public services which work as a source of utility. Assuming constant returns to scale in the production, we show that public services promote the occurrence of local indeterminacy. In contrast to a lot of existing contributions which have exploited productive externalities, this paper establishes that the existence of externalities in the utility function can explain the emergence of endogenous fluctuations.

Keywords: Endogenous; fluctuations (search for similar items in EconPapers)
JEL-codes: E3 H4 (search for similar items in EconPapers)
Date: 2003-05-22
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Citations: View citations in EconPapers (18)

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