Admiration is a source of multiple equilibria and indeterminacy: A comment on Chen and Hsu (2007)

摘要

The aim of this note is to revise and correct the properties of steady state(s) obtained in Chen and Hsu (2007). They proved that admiration and decreasing marginal impatience may establish indeterminacy when the steady state is unique. Instead, we prove that, in the long-run equilibrium (equilibria), (i) indeterminacy never occurs when the steady state is unique, and (ii) indeterminacy may occur only when the steady states are not unique. (C) 2018 Elsevier B.V. All rights reserved.