Consumption Externalities, Habit Formation, and Equilibrium Efficiency

Authors :: Alonso Carrera, Jaime
Caballé, Jordi
Raurich, Xavier
Universitat Autònoma de Barcelona. Unitat de Fonaments de l'Anàlisi Econòmica
Institut d'Anàlisi Econòmica
Source :: Digital.CSIC. Repositorio Institucional del CSIC, instname, Recercat. Dipósit de la Recerca de Catalunya
Publication Year :: 2001
Abstract: We analyze the welfare properties of the competitive equilibrium in a capital accumulation model where individual preferences are subjected to both habit formation and consumption spillovers. We also discuss how consumption externalities and habits interact to generate an inefficient dynamic equilibrium. Finally, we characterize optimal tax policies aimed to restore efficient decentralized paths.

Subjects :: Consumption externalities
Habit Formation
Equilibrium Efficiency
Finances -- Models economètrics

Language :: English
Database :: OpenAIRE
Journal :: Digital.CSIC. Repositorio Institucional del CSIC, instname, Recercat. Dipósit de la Recerca de Catalunya
Accession number :: edsair.dedup.wf.001..b5b127d8ca5979f39d99547421b2feb1

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