Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers
(2012)
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- Abstract
- The main result is that the golden rule equilibrium (GRE) is Pareto optimal (in the classical sense) in an overlapping generations (OG) model with constant-returns-to-scale production, transfers, arbitrary life-time productivity and CES instantaneous felicity. In addition, we extend Cass and Yaari’s [10] equivalence between efficiency (aggregate consumption dominance) and the present value dominance (with evaluation made using a candidate equilibrium price path).
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Citations
Mertens, J.-F., & Rubinchik, A. (2012). Pareto optimality of the golden rule equilibrium in an overlapping generations model with production and transfers (CORE Discussion Paper 2012/33). https://hdl.handle.net/2078.5/208045