OPTIMAL ECONOMIC GROWTH AND WEALTH EFFECTS.
Abstract
The presence of wealth effects is shown to be a possible cause of the appearance of 'Saddle points' or multiple stationary solutions for the optimal path of economic growth. The importance of this fact is that it tends to narrow down the range of economic growth prescribed by the optimal path. This is so since starting from a fixed initial condition, and then having a multiplicity of stationary solutions may lead to the appearance of a relatively 'close' point towards which the optimal path converges.
Document Details
- Document Type
- Technical Report
- Publication Date
- Oct 18, 1965
- Accession Number
- AD0622871
Entities
People
- Mordecai Kurz
Organizations
- Stanford University