Characterization of lntertemporal Optimality in Terms of Decentralizable Conditions: The Discounted Case

Swapan Dasgupta and Tapan Mitra

Chapter 4 in Decentralization in Infinite Horizon Economies, 2015, pp 58-71 from World Scientific Publishing Co. Pte. Ltd.

Abstract: The paper studies the problem of characterizing the optimality of competitive programs in terms of “decentralizable” conditions. We show that, when future utilities are discounted, and the optimal stationary stock is proportionately expansible, then optimality of competitive programs can be characterized by the condition that the scalar product of the difference of prices and quantities, between those of the given competitive program and those of the optimal stationary program, be non-positive period by period.

Keywords: Efficient Allocations; Optimal Growth; Transversality Conditions; Decentralization; Mechanism Design; Rolling Plans (search for similar items in EconPapers)
Date: 2015
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Journal Article: Characterization of intertemporal optimality in terms of decentralizable conditions: The discounted case (1988)
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