Equilibrium welfare and government policy with quasi-geometric discounting

• 成果类型: Article
• 署名作者: Krusell, P; Kurusçu, B; Smith, AA Jr
• 署名单位: University of Rochester; Centre for Economic Policy Research - UK; Carnegie Mellon University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1006/jeth.2001.2888
• 发表日期: 2002
• 页码: 42-72
• 关键词: quasi-geometric discounting; Markov equilibrium; taxation; Time-consistent policy

摘要

We consider a representative-agent equilibrium model where the consumer has quasi-geometric discounting and cannot commit to future actions. We restrict attention to a parametric class for preferences and technology and solve for time-consistent competitive equilibria globally and explicitly. We then characterize the welfare properties of competitive equilibria and compare them to that of a planning problem. The planner is a consumer representative who, without commitment but in a time-consistent way, maximizes his or her present-value utility subject to resource constraints. The competitive equilibrium results in strictly higher welfare than the planning problem whenever the discounting is not geometric. Journal of Economic Literature Classification Numbers: E21, E61, E91. (C) 2002 Elsevier Science (USA).