Characterize a dynamic equilibrium of this economy

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Consider the OLG model with warm glow preferences in Section 9.6, and suppose that preferences are given by u₁(ci(t)) + u₂(bi(t)), where u₁ and u₂are strictly increasing and concave functions. The production side is the same as in the text. Characterize a dynamic equilibrium of this economy. Provide sufficient conditions on u₁(.) and u₂(.) such that (1) aggregate dynamics are globally stable, and (2) all individuals asymptotically tend to the same wealth level.

Reference no: EM131135966

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