Intermediation, Bubbles, and Pareto Efficiency in Economies with Production Pingle, Mark Tesfatsion, Leigh Tesfatsion, Leigh
dc.contributor.department Economics 2018-02-16T04:23:11.000 2020-06-30T02:04:21Z 2020-06-30T02:04:21Z 2015-04-13 1991-04-01
dc.description.abstract <p>In a recent study, Tirole (1985) extends Diamond's (1965, pp. 1130-1135) well-known overlapping generations model of a private production economy by permitting consumption loans. That is, in addition to financing the capital investment of firms, the savings of one generation can be used to finance the consumption of agents in other generations whose consumption demands are in excess of their endowments. Tirole then shows that the re sulting production-consumption loan economy fails to satisfy the First Welfare Theorem. Specifically, as reviewed in Section 2, below, two stationary competitive equilibria exist for this economy: a Pareto inefficient equilibrium e with no consumption loans; and a Pareto efficient "golden-rule" equihbrium e" in which consumption loans are made...</p>
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dc.identifier.articleid 1022
dc.identifier.contextkey 6977465
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dc.subject.disciplines Business and Corporate Communications
dc.subject.disciplines Growth and Development
dc.subject.disciplines Industrial Organization
dc.subject.disciplines Models and Methods
dc.subject.disciplines Public Economics
dc.title Intermediation, Bubbles, and Pareto Efficiency in Economies with Production
dc.type article
dc.type.genre report
dspace.entity.type Publication
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