Econometrica: Sep 1976, Volume 44, Issue 5

Optimal Growth in a Putty-Clay Model

https://doi.org/0012-9682(197609)44:5<867:OGIAPM>2.0.CO;2-P
p. 867-878

Guillermo A. Calvo

Global necessary conditions are obtained for a discrete capital version of the putty-clay model first introduced by Johansen [7]. Convergence of the optimal solution to a steady state is discussed for concave utilities. Also, the role of obsolescence is analyzed when utility is linear
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