Exercise 9.9. Consider again the canonical overlapping generations model with log preferences and Cobb-Douglas production function, but
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Exercise 9.9. Consider again the canonical overlapping generations model with log preferences and Cobb-Douglas production function, but assume that individuals now work in both periods of their lives. (1) Define a competitive equilibrium and the steady-state equilibrium. (2) Characterize the steady-state equilibrium and the transitional dynamics in this economy. (3) Can this economy generate overaccumulation?
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