Capital accumulation with tangible assets

Abstract: The paper develops a neoclassical growth model with capital accumulation and a retradable tangible asset in an overlapping generations framework. It analyzes its effect on the dynamics of capital accumulation. Two period lived consumers hold portfolios consisting of real capital and the tangible asset. It is shown that the possibility of trading the tangible asset as an alternative to capital may cause the coexistence of stable steady states with high and low levels of capital and with disjoint basins of attraction. Thus, the so-called poverty trap may appear purely endogenously generated as a consequence of asset trading alone. The possibility of the occurrence of the poverty trap is reduced as factors of production become more substitutable. However, the result is robust for continua of homogeneous as well as heterogeneous consumers

Standort
Deutsche Nationalbibliothek Frankfurt am Main
Umfang
Online-Ressource
Sprache
Englisch
Anmerkungen
Postprint
begutachtet (peer reviewed)
In: Journal of Economic Behavior & Organization ; 68 (2008) 1 ; 248-257

Klassifikation
Wirtschaft

Ereignis
Veröffentlichung
(wo)
Mannheim
(wann)
2008
Urheber
Böhm, Volker
Vachadze, George

DOI
10.1016/j.jebo.2008.04.005
URN
urn:nbn:de:0168-ssoar-264036
Rechteinformation
Open Access unbekannt; Open Access; Der Zugriff auf das Objekt ist unbeschränkt möglich.
Letzte Aktualisierung
25.03.2025, 13:49 MEZ

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Beteiligte

  • Böhm, Volker
  • Vachadze, George

Entstanden

  • 2008

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