Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/92830
Authors: 
Ikefuji, Masako
Mino, Kazuo
Year of Publication: 
2009
Series/Report no.: 
ISER Discussion Paper, Institute of Social and Economic Research, Osaka University 750
Abstract: 
This paper explores the roles of internal and external habit formation in a simple model of endogenous growth with overlapping generations. Unlike the representative agent settings in which the distinction between internal and external habits may not yield significant qualitative differences in working of the model economy, we show that the internal and external habit persistence in overlapping generations economies may have qualitatively different effects on the steady-state characterization as well as on the dynamic behavior of the economy. We also confirm that in an overlapping generations framework, whether the habits in the utility function takes subtractive or multiplicative forms may be critical both for long-run growth and for transitional dynamics.
Subjects: 
internal habits formation
external habit formation
overlapping generations economy
long-run growth
JEL: 
E32
J24
O40
Document Type: 
Working Paper

Files in This Item:
File
Size
317.37 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.