Existence and Stability of Steady State in an Augmented Solow Model with Multiple Capital Goods

Jian Li and Yao Lu
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Yao Lu: School of Economics, Nanjing University, Nanjing 210093, China

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2018, vol. 13, issue 4, 685-702

Abstract: This paper relaxes two assumptions on the traditional augmented Solow model: strict concavity of production functions and dual capital goods. It generalizes traditional conclusions of the Solow model by demonstrating that neoclassical properties of a production function are sufficient for the existence and global stability of the steady state in the augmented Solow model with multiple capital goods. Moreover, we prove necessity of essentiality of inputs for a neoclassical production function and generalize the golden rule of capital accumulation.

Keywords: multiple capital goods; augmented Solow model; essentiality of inputs; steady state; strict concavity (search for similar items in EconPapers)
JEL-codes: C62 O30 O40 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:fec:journl:v:13:y:2018:i:4:p:685-702

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