On the Ramsey equilibrium with heterogeneous consumers and endogenous labor supply

Stefano Bosi and Thomas Seegmuller
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Stefano Bosi: EQUIPPE - Universit de Lille 1 et EPEE

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: In this paper, we address the question of deterministic cycles in a Ramsey model with heterogeneous infinite-lived agents and borrowing constraints, augmented to take into account the case of elastic labor supply. Under usual restrictions, not only we show that the steady state is unique, but also we clarify its stability properties through a local analysis. We find that, in many cases, the introduction of elastic labor supply promotes convergence by widening the range of parameters for saddle-path stability and endogenous cycles can eventually disappear. These results are robustly illustrated by means of canonical examples in which consumers have separable, KPR or homogeneous preferences

Keywords: Saddle-path stability; endogenous cycles; heterogeneous agents; endogenous labor supply; borrowing constraint (search for similar items in EconPapers)
JEL-codes: C62 D30 E32 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2007-01, Revised 2007-07
New Economics Papers: this item is included in nep-dge and nep-mac
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Citations: View citations in EconPapers (5)

Published in Journal of Mathematical Economics, 46, (4), 2010, pp.475-492

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https://shs.hal.science/halshs-00143421 (application/pdf)
https://doi.org/10.1016/j.jmateco.2010.03.002

Related works:
Journal Article: On the Ramsey equilibrium with heterogeneous consumers and endogenous labor supply (2010)
Working Paper: On the Ramsey Equilibrium with heterogeneous consumers and endogenous labor supply (2007)
Working Paper: On the Ramsey Equilibrium with heterogeneous consumers and endogenous labor supply (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:mse:cesdoc:v07003a

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