Entry and the accumulation of capital: A two state variable extension to the Ramsey model

Bibliographic Details
Main Author: Brito, Paulo
Publication Date: 2009
Other Authors: Dixon, Huw
Format: Article
Language: eng
Source: Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
Download full: http://hdl.handle.net/10400.5/30428
Summary: In this paper we consider the entry and exit of firms in a dynamic general equilibrium model with capital. At the firm level, there is a fixed cost combined with increasing marginal cost, which gives a standard U-shaped cost curve with optimal firm size. Entry is determined by a free entry condition such that the cost of entry is equal to the present value of incumbent firms. The cost of entry (exit) depends on the flow of entry (exit). Equilibrium is saddle-point stable and the stable manifold is two-dimensional. Transitional dynamics can, under certain circumstances, be non-monotonic.
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spelling Entry and the accumulation of capital: A two state variable extension to the Ramsey modelEntryDynamicsRamseyIn this paper we consider the entry and exit of firms in a dynamic general equilibrium model with capital. At the firm level, there is a fixed cost combined with increasing marginal cost, which gives a standard U-shaped cost curve with optimal firm size. Entry is determined by a free entry condition such that the cost of entry is equal to the present value of incumbent firms. The cost of entry (exit) depends on the flow of entry (exit). Equilibrium is saddle-point stable and the stable manifold is two-dimensional. Transitional dynamics can, under certain circumstances, be non-monotonic.John Wiley & SonsRepositório da Universidade de LisboaBrito, PauloDixon, Huw2024-03-18T10:32:53Z20092009-01-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.5/30428engBrito, Paulo and Huw Dixon .(2009). “Entry and the accumulation of capital: A two state variable extension to the Ramsey model”, International Journal of Economic Theory, Volume 5, Issue 1: pp. 333–357. (Search PDF in 2024)doi: 10.1111/j.1742-7363.2009.00113.x1742-7363info:eu-repo/semantics/openAccessreponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiainstacron:RCAAP2025-03-17T16:23:54Zoai:repositorio.ulisboa.pt:10400.5/30428Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireinfo@rcaap.ptopendoar:https://opendoar.ac.uk/repository/71602025-05-29T04:12:36.691935Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiafalse
dc.title.none.fl_str_mv Entry and the accumulation of capital: A two state variable extension to the Ramsey model
title Entry and the accumulation of capital: A two state variable extension to the Ramsey model
spellingShingle Entry and the accumulation of capital: A two state variable extension to the Ramsey model
Brito, Paulo
Entry
Dynamics
Ramsey
title_short Entry and the accumulation of capital: A two state variable extension to the Ramsey model
title_full Entry and the accumulation of capital: A two state variable extension to the Ramsey model
title_fullStr Entry and the accumulation of capital: A two state variable extension to the Ramsey model
title_full_unstemmed Entry and the accumulation of capital: A two state variable extension to the Ramsey model
title_sort Entry and the accumulation of capital: A two state variable extension to the Ramsey model
author Brito, Paulo
author_facet Brito, Paulo
Dixon, Huw
author_role author
author2 Dixon, Huw
author2_role author
dc.contributor.none.fl_str_mv Repositório da Universidade de Lisboa
dc.contributor.author.fl_str_mv Brito, Paulo
Dixon, Huw
dc.subject.por.fl_str_mv Entry
Dynamics
Ramsey
topic Entry
Dynamics
Ramsey
description In this paper we consider the entry and exit of firms in a dynamic general equilibrium model with capital. At the firm level, there is a fixed cost combined with increasing marginal cost, which gives a standard U-shaped cost curve with optimal firm size. Entry is determined by a free entry condition such that the cost of entry is equal to the present value of incumbent firms. The cost of entry (exit) depends on the flow of entry (exit). Equilibrium is saddle-point stable and the stable manifold is two-dimensional. Transitional dynamics can, under certain circumstances, be non-monotonic.
publishDate 2009
dc.date.none.fl_str_mv 2009
2009-01-01T00:00:00Z
2024-03-18T10:32:53Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/10400.5/30428
url http://hdl.handle.net/10400.5/30428
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv Brito, Paulo and Huw Dixon .(2009). “Entry and the accumulation of capital: A two state variable extension to the Ramsey model”, International Journal of Economic Theory, Volume 5, Issue 1: pp. 333–357. (Search PDF in 2024)
doi: 10.1111/j.1742-7363.2009.00113.x
1742-7363
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv John Wiley & Sons
publisher.none.fl_str_mv John Wiley & Sons
dc.source.none.fl_str_mv reponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
instacron:RCAAP
instname_str FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
instacron_str RCAAP
institution RCAAP
reponame_str Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
collection Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
repository.name.fl_str_mv Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
repository.mail.fl_str_mv info@rcaap.pt
_version_ 1833601982774902784

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