Resource title

On the Transition from Instantaneous to Time-Lagged Capital Accumilation: The Case of Leontief Type Production Functions

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Resource description

We formulate an optimal control capital accumulation model with a Leontief-type production function and an exogenously given time-lag between investment and the accumulation of the capital stock, to analyze the qualitative and quantitative influence of time-lags on the system dynamics. As known from the time-to-build literature, optimal investment paths for positive and finite time-lags are in general cyclical, in contrast to the monotonic optimal paths for instantaneous capital accumulation. We show that the transition between instantaneous and time-lagged capital accumulation is continuous, in the sense that the greater is the time-lag between investment and capital accumulation, the more likely and more pronounced becomes cyclical behavior of the optimal paths.

Resource author

Ralph Winkler, Ulrich Brandt-Pollmann, Ulf Moslener, Johannes Schlöder

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Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/24121

Resource license

Adapt according to the presented license agreement and reference the original author.