A Note on Capital Accumulation in a Two Sector General Equilibrium Model with Transfer
5 Pages Posted: 31 Mar 2003
Date Written: June 2002
In this paper we show that in a two sector dynamic general equilibrium (DGE)model where part of produced capital is used as a production input in the originating sector, while remaining part is costly transferred to the other sector the optimal policies for consumption and investment are constant functions equal to zero.
Keywords: Multisector Accumulation Models, Value Function
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