Working Paper
Cycles and Indeterminacy in Overlapping Generations Economies with Stone-Geary Preferences
Erkki Koskela, Mikko Puhakka
CESifo, Munich, 2006
CESifo Working Paper No. 1737
CESifo, Munich, 2006
CESifo Working Paper No. 1737
We investigate dynamics in an overlapping generations economy with Stone-Geary preferences. We show that a steady state exists, and furthermore and importantly, that there can be a multitude of two cycles even though intertemporal elasticity of substitution in consumption exceeds unity.
Keywords: Stone-Geary preferences, overlapping generations economy, cycles and indeterminacy