Welfare implications of the interaction between habits and consumption externalities

• 成果类型: Article
• 署名作者: Alonso-Carrera, J; Caballé, J; Raurich, X
• 署名单位: Autonomous University of Barcelona; Universidade de Vigo; University of Barcelona
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/j.1468-2354.2006.00388.x
• 发表日期: 2006
• 页码: 557-571
• 关键词: relative consumption; rational addiction; asset prices; GROWTH; joneses; equilibrium; POLICY

摘要

We analyze the welfare properties of the equilibrium path of a growth model where both habits and consumption externalities affect the utility of consumers. Our analysis highlights the crucial role played by complementarities between externalities and habits in order to generate an inefficient dynamic equilibrium. In particular, we show that the competitive equilibrium is inefficient when consumption externalities and habit-adjusted consumption are not perfect substitutes.