1. Strategic Interactions in a One-Sector Growth Model
- Author
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Eric Fesselmeyer, Leonard J. Mirman, and Marc Santugini
- Subjects
Statistics and Probability ,jel:D81 ,0209 industrial biotechnology ,Economics and Econometrics ,Sequential game ,02 engineering and technology ,Microeconomics ,jel:O40 ,020901 industrial engineering & automation ,Capital accumulation ,0502 economics and business ,Economics ,050205 econometrics ,Consumption (economics) ,jel:D92 ,Capital accumulation, dynamic game, growth, investment, technical progress ,Applied Mathematics ,jel:C72 ,05 social sciences ,jel:C73 ,Investment (macroeconomics) ,Computer Graphics and Computer-Aided Design ,Social planner ,Computer Science Applications ,Technical progress ,Computational Mathematics ,Computational Theory and Mathematics ,Capital (economics) ,Capital accumulation, Dynamic game, Growth, Investment, Non-excludable capital ,Externality - Abstract
We study the effect of dynamic and investment externalities in a one-sector growth model. In our model, two agents interact strategically in the utilization of capital for consumption, savings, and investment in technical progress. We consider two types of investment choices: complements and substitutes. For each case, we derive the equilibrium and provide the corresponding stationary distribution. We then compare the equilibrium with the social planner’s solution.
- Published
- 2015
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