Periodic Solutions of the One-sector Growth Model: The Role of Income Effects


The discrete-time version of the neoclassical one-sector growth model with elastic labor supply is considered. It is shown that this model can have periodic solutions only if leisure is an inferior good.


Optimal growth, Elastic labor supply, Periodic solutions, Inferiority of leisure

JEL Classification

C61, O41


Kazumichi IWASA
Research Institute for Economics and Business Administration,
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059

Gerhard SORGER
Department of Economics, University of Vienna, Austria