IDEAS home Printed from https://ideas.repec.org/a/ris/buecqu/0020.html
   My bibliography  Save this article

Economic growth, habit formation, and business cycle

Author

Listed:
  • Zhang, Wei-Bin

    (Ritsumeikan Asia Pacific University, Japan)

Abstract

The purpose of this paper is to demonstrate the existence of business cycles in a theoretical economic growth model with endogenous habit formation, wealth, and preference change proposed. The model studies preference changes and habit formation in an extended Solow-Uzawa neoclassical development model with elastic labor supply. The study introduces the preference change based on the traditional literature on time preference and habit formation in the Ramsey approach to modelling behavior of households. It makes the model proposed by Zhang (2013) more robust with all the time-independent parameters generalized as time-dependent parameters. The model is simulated. Business cycles and preference oscillations are demonstrated under various exogenous periodic shocks.

Suggested Citation

  • Zhang, Wei-Bin, 2020. "Economic growth, habit formation, and business cycle," BizEcons Quarterly, Strides Educational Foundation, vol. 10, pages 3-20.
    • Handle: RePEc:ris:buecqu:0020
    as

    Download full text from publisher

    File URL: http://bequarterly.rysearch.com/wp-content/uploads/2020/05/Wei-Bin-Zhang.pdf
    File Function: Full text
    Download Restriction: olaniyievans@gmail.com
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Endogenous preference; Economic oscillations; Economic structure; Wealth accumulation;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:buecqu:0020. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Olaniyi Evans (email available below). General contact details of provider: https://bizecons.5profz.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.