Multiple equilibria in the Aghion–Howitt model

Jess Benhabib

Research in Economics, 2014, vol. 68, issue 2, 112-116

Abstract: We show that the simple Aghion–Howitt model exhibits oscillatory indeterminacy in the process of creative destruction as firms undertaking new research do not internalize their effect on existing firms. A simple calibration shows that indeterminacy occurs for quite plausible parametrizations of the share of the intermediate good.

Keywords: Endogenous growth; Indeterminacy; Quality ladder (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reecon:v:68:y:2014:i:2:p:112-116

DOI: 10.1016/j.rie.2013.10.002

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