Constrained Efficiency in the Neoclassical Growth Model With Uninsurable Idiosyncratic Shocks

• 成果类型: Article
• 署名作者: Davila, Julio; Hong, Jay H.; Krusell, Per; Rios-Rull, Jose-Victor
• 署名单位: Centre National de la Recherche Scientifique (CNRS); Paris School of Economics; University of Rochester; Stockholm University; University of Gothenburg; University of Minnesota System; University of Minnesota Twin Cities; Center for Economic & Policy Research (CEPR); Federal Reserve System - USA; Federal Reserve Bank - Minneapolis; National Bureau of Economic Research
• 刊物名称: ECONOMETRICA
• ISSN/ISSBN: 0012-9682
• DOI: 10.3982/ECTA5989
• 发表日期: 2012
• 页码: 2431-2467
• 关键词: stock-market; precautionary savings; borrowing constraints; general equilibrium; optimal taxation; capital income; externalities; INEFFICIENCY; liquidity; earnings

摘要

We investigate the welfare properties of the one-sector neoclassical growth model with uninsurable idiosyncratic shocks. We focus on the notion of constrained efficiency used in the general equilibrium literature. Our characterization of constrained efficiency uses the first-order condition of a constrained planner's problem. This condition highlights the margins of relevance for whether capital is too high or too low: the factor composition of income of the (consumption-)poor. Using three calibrations commonly considered in the literature, we illustrate that there can be either over- or underaccumulation of capital in steady state and that the constrained optimum may or may not be consistent with a nondegenerate long-run distribution of wealth. For the calibration that roughly matches the income and wealth distribution, the constrained inefficiency of the market outcome is rather striking: it has much too low a steady-state capital stock.