A model of growth with inherited tastes
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This research aims at studying a general equilibrium closed economy with overlapping generations and inherited tastes (aspirations), as in de la Croix (Econ Lett 53(1):89–96, 1996). It shows that the interaction between the intensity of aspirations and the elasticity of substitution of effective consumption affects the qualitative and quantitative long-term dynamics from both local and global perspectives. The related literature is extended by showing that (1) the Neimark–Sacker bifurcation found by de la Croix (1996) does not necessarily give rise to fluctuations and (2) endogenous (long-lasting) fluctuations occur through the emergence of period-doubling bifurcations.
KeywordsAspirations Bifurcations Endogenous fluctuations Overlapping generations
JEL ClassificationC61 C62 C68 E32 J22 O41
The authors gratefully acknowledge that this work has been performed within the activity of the PRIN-2009 project “Structural Change and Growth”, MIUR (Ministry of Education), Italy. The authors are also indebted to Xavier Raurich, Jaime Alonso-Carrera and participants at conferences “Structural Change, Dynamics and Economic Growth” held in Livorno, Italy, on September 2013 and “International Conference on Applied Business and Economics” held in Manhattan, New York, USA, on October 2013. The authors also thank two anonymous reviewers for insightful comments and suggestions allowing a substantial improvement in the quality of the work. The usual disclaimer applies.
Compliance with ethical standards
Conflict of interest
The authors declare that they have no conflict of interest.
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