Economic growth and multiple equilibria: A critical note

José Gaspar, P.B. Vasconcelos and O. Afonso

Economic Modelling, 2014, vol. 36, issue C, 157-160

Abstract: Recent literature on economic growth points towards the possibility of the existence of multiple equilibria, under certain conditions. In this paper we use a growth model with a public health infrastructure to analyze, in detail, its local dynamics. The discussion of the existence of equilibria in the model reveals that some candidates for equilibria turn out to be non-relevant and are therefore ruled out. Indeed, multiple equilibria may only arise under restrictive parameter values, meaning that the so called “growth miracles” in some literature may be less likely to occur. Numerical computations illustrate that each relevant equilibrium exhibits local saddle-path stability.

Keywords: Economic growth; Multiple equilibria; Growth miracle; Poverty traps (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:36:y:2014:i:c:p:157-160

DOI: 10.1016/j.econmod.2013.09.037

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