The Subgame Imperfection of Financial Capitalism

Amelia Correa, Romar Correa, D Rao () and Graciella Tavares
Additional contact information
Amelia Correa: Department of Economics, St. Andrew’s College, Mumbai 400 058, India
Graciella Tavares: Department of Economics, St. Andrew’s College, Mumbai 400 058, India

Journal of Interdisciplinary Economics, 2003, vol. 14, issue 1, 3-12

Abstract: We formulate and solve the Pasinetti (1962) model as a dynamic game played between capitalists and workers. The interest rate is shown to be bounded above. If the discount rates of capitalists and workers required to sustain cooperation between them exceed this interest rate the Nash equilibrium unravels. We introduce a bank whose sole objective is to lower the rate of interest. The financial intermediary cannot ensure the equality through time of the supply of and the demand for assets in general.

Date: 2003
References: Add references at CitEc
Citations:

Downloads: (external link)
http://jie.sagepub.com/content/14/1/3.abstract (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:jinter:v:14:y:2003:i:1:p:3-12

Access Statistics for this article

More articles in Journal of Interdisciplinary Economics
Bibliographic data for series maintained by SAGE Publications ().