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In this paper we propose a unifying approach to study optimal growth models with bounded or unbounded returns (above/below). We prove existence of optimal solutions. We prove also, without using contraction method, that the Value function is the unique solution to the Bellman equation in some classes of functions. The value function can be obtained by the(More)
Existing literature continues to be unable to offer a convincing explanation for the volatility of the stochastic discount factor in real world data. Our work provides such an explanation. We do not rely on frictions, market incompleteness or transactions costs of any kind. Instead, we modify a simple stochastic representative agent model by allowing for(More)
In this paper we propose a unifying approach to the study of recursive economic problems. Postulating an aggregator function as the fundamental expression of tastes, we explore conditions under which a utility function can be constructed. We also modify the usual dynamic programming arguments to include this class of models. We show that Bellman's equation(More)
We address the fundamental issues of existence and efficiency of an equilibrium in a Ramsey model with many agents, where agents have heterogenous discounting, elastic labor supply and face borrowing constraints. The existence of rational bubbles is also tackled. In the first part, we prove the equilibrium existence in a truncated bounded economy through a(More)
* This paper is to appear in Journal of Global Optimization.The authors, in various combinations , are indebted to several institutions for hospitality and support. These include Paris 1 and the University of Alabama. Page and Wooders are also indebted to CentER (Tilberg University) and the Autonomous University of Barcelona for hospitality and support(More)