Optimality of Ramsey-Euler policy in the stochastic growth model
نویسندگان
چکیده
For the standard one sector stochastic optimal growth model, we outline a new set of conditions for a policy function that satisfies the Ramsey-Euler equation to be optimal. An interior Ramsey-Euler policy function is optimal if (and only if) it is continuous or alternatively, if both consumption and investment are non-decreasing in output. One does not need to verify the transversality condition to show that the Ramsey-Euler policy function is optimal.
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ورودعنوان ژورنال:
- J. Economic Theory
دوره 172 شماره
صفحات -
تاریخ انتشار 2017