Multiple equilibria and global indeterminacy in an endogenous growth model with congestible public goods
Bella, Giovanni
;Mattana, Paolo
2019-01-01
Abstract
This paper extends the findings in Chen and Lee (2007) to show that the use of congestible public goods can produce both local and global indeterminacy in a two‐sector endogenous growth model with productive public services financed by income taxation. Basically, we observe the effects on growth rates by changing parameters, and compare the case of a single steady‐state with the emergence of dual steady‐states, identifying the feasible ways to avoid a possible low‐growth poverty trap. The novelty of our analysis is to detect the presence of global indeterminacy by making use of the Bogdanov‐Takens bifurcation theorem. Some examples are also provided to achieve concrete policy implications.File | Size | Format | |
---|---|---|---|
Bella_et_al-2018-Journal_of_Public_Economic_Theory.pdf Solo gestori archivio
Type: versione post-print
Size 862.91 kB
Format Adobe PDF
|
862.91 kB | Adobe PDF | & nbsp; View / Open Request a copy |
Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.