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Autre publication scientifique Année : 2015

On Time-Consistent Policy Rules for Heterogeneous Discounting Programs

Résumé

This article considers a new concept of social optimum for an economy populated by agents with heterogeneous discount factors. It is based upon an approach that constrains decision rules to be temporally consistent: these are stationary and unequivocally ruled by the state variable. For agents who differ only in their discount factors and have equal weights in the planner's objective, the temporally-consistent optimal solution produces identical consumption for the agents at all time periods. In the long run, the capital stock is determined by a modified golden rule that corresponds to an average-like summation of all discount factors. The general argument is illustrated by various two-agent examples that allow for an explicit determination of the temporally consistent decision rules. Interestingly, this temporally consistent solution can be simply recovered from the characterization of a social planner's problem with variable discounting and can also be decentralised as a competitive equilibrium through the use of various instruments.
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Dates et versions

halshs-01243669, version 1 (15-12-2015)

Identifiants

  • HAL Id : halshs-01243669 , version 1

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Jean-Pierre Drugeon, Bertrand Wigniolle. On Time-Consistent Policy Rules for Heterogeneous Discounting Programs. 2015. ⟨halshs-01243669⟩
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