Stationary Ramsey Equilibria under Uncertainty

Robert Becker*, Itzhak Zilcha

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Deterministic dynamic equilibrium models with borrowing constraints and heterogeneous agents exhibit stationary solutions where the most patient household owns the economy's capital stock. An example shows that this result does not carry over to stationary stochastic environments. We prove, under some conditions, the existence of a stationary rational expectations equilibrium in two related setups. The first is the existence of a stationary Nash equilibrium where each agent's payoff depends on his capital process and the capital processes of the remaining agents. The second existence theorem applies to a stationary competitive equilibrium model.Journal of Economic LiteratureClassification Numbers: E13, E21, D80.

Original languageEnglish
Pages (from-to)122-140
Number of pages19
JournalJournal of Economic Theory
Issue number1
StatePublished - Jul 1997


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