Vintage capital, investment, and growth

Jess Benhabib, Aldo Rustichini

    Research output: Contribution to journalArticle

    Abstract

    We study the dynamics of growth and investment in a continuous time model with vintage capital. Vintage capital models may be characterized by non-exponential rates of depreciation and technical change and can incorporate "gestation lags" as well as "learning by using." We investigate the effect of such features on the dynamics of investment and growth and show how they can contribute to explaining the volatile nature of investment time-series.

    Original languageEnglish (US)
    Pages (from-to)323-339
    Number of pages17
    JournalJournal of Economic Theory
    Volume55
    Issue number2
    DOIs
    StatePublished - Dec 1991

    ASJC Scopus subject areas

    • Economics and Econometrics

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