This article describes some dynamic aspects on dynastic utility incorporating two-sided altruism with an OLG setting. The special case is analyzed where the weights of two-sided altruism are dynamically inconsistent. ...This article describes some dynamic aspects on dynastic utility incorporating two-sided altruism with an OLG setting. The special case is analyzed where the weights of two-sided altruism are dynamically inconsistent. The Bellman equation for two-sided altruism proves to be reduced to one-sided dynamic problem, but the effective discount factor is different only in the current generation. It is shown that a contraction mapping result of value function cannot be achieved in general, and that there can locally exist an infinite number of self-consistent policy functions of the class C＂ with distinct steady states （indeterminacy of self-consistent, differentiable policy functions）.展开更多
文摘This article describes some dynamic aspects on dynastic utility incorporating two-sided altruism with an OLG setting. The special case is analyzed where the weights of two-sided altruism are dynamically inconsistent. The Bellman equation for two-sided altruism proves to be reduced to one-sided dynamic problem, but the effective discount factor is different only in the current generation. It is shown that a contraction mapping result of value function cannot be achieved in general, and that there can locally exist an infinite number of self-consistent policy functions of the class C＂ with distinct steady states （indeterminacy of self-consistent, differentiable policy functions）.
