Frequency of trade and the determinacy of equilibrium in economies of overlapping generations

Hippolyte d'Albis and Emmanuelle Augeraud-Véron

MPRA Paper from University Library of Munich, Germany

Abstract: Demichelis and Polemarchalis (2007) highlighted the role played by the frequency of trade on the degree of indeterminacy of equilibrium in economies of overlapping generations. Assuming that time has a finite starting point and extends into the infinite future, they prove that the degree of indeterminacy increases with the number of periods in the life-span of individuals, which is assumed to be deterministic. We show that this result does not hold when individual longevity is represented by an exponential survival function: the degree of indeterminacy depends on individual preferences and monetary policy but is independent of the frequency of trade.

Keywords: Overlapping; generations; ⋅; Perpetual; youth; model; ⋅; Determinacy; ⋅; Continuous; time; ⋅; Discrete; time (search for similar items in EconPapers)
JEL-codes: D5 D9 (search for similar items in EconPapers)
Date: 2012-11-20
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Published in International Journal of Economic Theory 9.1(2013): pp. 85-100

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Related works:
Journal Article: Frequency of trade and the determinacy of equilibrium in economies of overlapping generations (2013)
Working Paper: Frequency of trade and the determinacy of equilibrium in economies of overlapping generations (2013)
Working Paper: Frequency of trade and the determinacy of equilibrium in economies of overlapping generations (2013)
Working Paper: Frequency of trade and the determinacy of equilibrium in economies of overlapping generations (2013)
Working Paper: Frequency of trade and the deterrminacy of equilibrium in economies of overlapping generations (2012)
Working Paper: Frequency of trade and the deterrminacy of equilibrium in economies of overlapping generations (2012)
Working Paper: Frequency of trade and the determinacy of equilibrium in economies of overlapping generations (2012)
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