RT Journal Article
SR 00
ID 10.1016/j.jmateco.2020.08.004
A1 Goenka, Aditya
A1 Nguyen, Manh-Hung
T1 General existence of competitive equilibrium in the growth model with an endogenous labor-leisure choice
JF Journal of Mathematical Economics
YR 2020
FD 2020-12
VO 91
SP 90
OP 98
K1 Optimal growth
K1 Competitive equilibrium
K1 Lagrange multipliers
K1 Elastic la-
K1 bor supply
K1 Inada conditions.
AB We prove the existence of competitive equilibrium in the canonical optimal growth  model with elastic labor supply under general conditions. In this model, strong  conditions to rule out corner solutions are often not well justied. We show using  a separation argument that there exist Lagrange multipliers that can be viewed  as a system of competitive prices. Neither Inada conditions, nor strict concavity,  nor homogeneity, nor dierentiability are required for existence of a competitive  equilibrium. Thus, we cover important specications used in the macroeconomics  literature for which existence of a competitive equilibrium is not well understood.  We give examples to illustrate the violation of the conditions used in earlier existence  results but where a competitive equilibrium can be shown to exist following the  approach in this paper.
PB Elsevier
SN 0304-4068
LK https://publications.ut-capitole.fr/id/eprint/41769/
UL https://www.tse-fr.eu/sites/default/files/medias/doc/by/nguyen/equilibrium.pdf