Increasing Returns to Scale and Welfare : Ranking the Multiple Deterministic Equilibria

@inproceedings{Bambi2007IncreasingRT,
  title={Increasing Returns to Scale and Welfare : Ranking the Multiple Deterministic Equilibria},
  author={Mauro Bambi},
  year={2007}
}
We consider a real business cycle model with productive externalities and an aggregate non-convex technology à la Benhabib and Farmer, which exhibits indeterminacy of the steady state and multiplicity of deterministic equilibria. The aim of the paper is to rank these different equilibria according to the initial values of consumption using both a non-naive… CONTINUE READING