Abstract
We present a one-sector growth model with finitely many households who differ from each other with respect to their endowments, their preferences, and the type of capital supplied to firms. There is monopolistic competition on the capital market and perfect competition on all other markets. We show that there exists a unique stationary equilibrium and that all households have strictly positive wealth in this equilibrium. We study how the stationary equilibrium depends on the time-preference rates of the households and on the elasticity of substitution between different types of capital. We also analyze the stability of the stationary equilibrium.
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© 2005 Springer
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Sorger, G. (2005). Differentiated Capital and the Distribution of Wealth. In: Deissenberg, C., Hartl, R.F. (eds) Optimal Control and Dynamic Games. Advances in Computational Management Science, vol 7. Springer, Boston, MA. https://doi.org/10.1007/0-387-25805-1_11
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DOI: https://doi.org/10.1007/0-387-25805-1_11
Publisher Name: Springer, Boston, MA
Print ISBN: 978-0-387-25804-1
Online ISBN: 978-0-387-25805-8
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