Browsing by Subject "Threshold dynamics"

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    Dynamic implications of prospect utility in an overlapping generations model
    (2014) Usta, Ahmet
    This thesis studies an overlapping generations model in the presence of prospect theory which has scarcely been addressed in macroeconomic growth models. The set up in this thesis provides us a unique steady state with global convergence and multiple steady states with local convergence. The presence of prospect preferences in the utility form leads to the multiplicity even under convex technology. Numerical analysis supports us that cross country income divergence can also be explained by a mechanism in which preference component is altered.
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    Saddle-node bifurcations in an optimal growth model with preferences for wealth habit
    (Walter de Gruyter GmbH, 2014) Sağlam, Ç.; Turan, A.; Turan, H.
    This paper studies the dynamic implications of preferences for wealth habit in a one-sector optimal growth model. We show that the dynamics may encounter saddle-node bifurcations with respect to the parameters of the preferences: the relative weight of wealth in utility and the degree of wealth habit. We analytically provide the monotone comparative statics and the continuity of the critical capital stock with respect to the discount factor, the relative weight of wealth in utility and the degree of wealth habit. © 2014 by Walter de Gruyter Berlin/Boston 2014.