On the Efficiency of Competitive Programmes in an Infinite-Horizon Model

Kurz, Mordecai; Starrett, David A.

doi:10.2307/2296486

Cited by 15 publications

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“…We showed Ž . a generalization of the necessity part of Michel 1990 Kurz and Starrett 1970, Mitra 1979, and Dasgupta and Mitra 1999a, 1999b …”

Section: Concluding Commentsmentioning

confidence: 99%

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Necessity of Transversality Conditions for Infinite Horizon Problems

Kamihigashi¹

2001

Econometrica

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This paper studies necessity of transversality conditions for the continuous time, Ž . reduced form model. By generalizing Benveniste and Scheinkman's 1982 ''envelope'' Ž . condition and Michel's 1990 version of the squeezing argument, we show a generaliza-Ž . tion of Michel's 1990, Theorem 1 necessity result that does not assume concavity. The Ž . generalization enables us to generalize Ekeland and Scheinkman's 1986 result as well as to establish a new result that does not require the objective functional to be finite. The new result implies that homogeneity of the return function alone is sufficient for the necessity of the most standard transversality condition. Our results are also applied to a nonstationary version of the one-sector growth model. It is shown that bubbles never arise in an equilibrium asset pricing model with a nonlinear constraint.

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“…We showed Ž . a generalization of the necessity part of Michel 1990 Kurz and Starrett 1970, Mitra 1979, and Dasgupta and Mitra 1999a, 1999b …”

Section: Concluding Commentsmentioning

confidence: 99%

“…Then i lim u hx s 0. ii If, moreo¨er, f x y hx G 0, then lim u hx s 0. Kurz and Starrett 1970, Mitra 1979, and Dasgupta and Mitra 1999a, 1999b…”

Section: žmentioning

confidence: 99%

Necessity of Transversality Conditions for Infinite Horizon Problems

Kamihigashi¹

2001

Econometrica

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Disaggregation in economic models

Tiplitz

1984

Naval Research Logistics

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This article illustrates numerically that the adjustment path of the economy will not show how a national policymaker may be misled by overaggregation until it is too late for correction. Labor and other resources are overaggregated in the equilibrating mechanism of most economic models, tending to mislead policymakers regarding both the amount and direction of change of important variables. Overaggregation also hides important constraints and tradeoffs which masks opportunities to use slack resources. In turn, this creates unnecessary dilemmas, such as that between inflation and unemployment which plagued the progress of the Humphrey-Hawkins Bill. The article first illustrates the hypothesis using simple models. Then its relevance to current analysis and planning is discussed.

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Duality Theory in Infinite Horizon Optimization Models

Mitra

Handbook on Optimal Growth 1

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On the Efficiency of Competitive Programmes in an Infinite-Horizon Model

Cited by 15 publications

References 0 publications

Necessity of Transversality Conditions for Infinite Horizon Problems

Necessity of Transversality Conditions for Infinite Horizon Problems

Disaggregation in economic models

Duality Theory in Infinite Horizon Optimization Models

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