Working papers

Subjective Expected Utility on Arbitrary State Spaces 

Abstract: This article considers Savage's theorem in a configuration relaxing the \textit{technical} axioms P6 and P7 that ensure a continuum nature on the set of states. With the only enrichment on fundamentals being the connectivity of the outcomes set, we show that a weakened version of the Independence property is sufficient to establish a utility function, a subjective probability, and an expected utility behavior. The proof does not require the existence of a pair event, an idea initiated by Ramsey (1926) and applied by Gul (1992). 

 On Ramsey equilibrium with dependent preferences (with Jean-Paul Barinci).

 Abstract: This paper introduces consumption externalities in a one-sector Ramsey economy featuring heterogeneous households and borrowing constraints. Externalities are taken into account by writing that the felicity functions depend upon the consumption of all the households in the economy. Focusing on the class of equilibria in which the most patient household owns the whole capital stock, it is proved that there exist non-convergent Ramsey equilibria even though the Maximum Income Monotonicity (MIM) condition holds.

 Optimal growth models under Rawlsian criteria (with Stefano Bosi).

Abstract: This article revisits optimal growth with three distinct Rawlsian approaches: (1) the original Rawlsian criterion, popular in economic literature; (2) the maximin with multiple discount factors, introduced by Chamber and Echenique (2018) ; (3) the rank-dependent criterion, applied by Zuber and Asheim (2012) to growth theory. Finally, we develop a new approach based on a convex combination of the most common criteria: Ramsey-Cass-Koopmans and Rawls.

 Heterogeneous bequests and social inequalities (with Kirill Borissov, Stefano Bosi and Mikhail Pakhnin). 

 Abstract: We study a growth model with two types of agents who are heterogeneous in their degree of family altruism. We prove that every equilibrium path converges to a unique steady state, and study the effect of altruism on the properties of steady-state equilibrium. We show that aggregate income is positively related to both levels of altruism and altruism heterogeneity. When altruism heterogeneity is low, income inequality follows an inverse U-shaped pattern relative to the level of altruism, which is consistent with the cross-country Kuznets curve. When altruism heterogeneity is high, income inequality monotonically decreases with the level of altruism. Our results suggest that heterogeneous altruism is an important mechanism linking economic growth and income inequality.

    On Multiple Time-Varying Discount Rates with Recursive Time-Dependent Orders (with Jean-Pierre Drugeon). 

Abstract: This study addresses time-dependent orders that lead to recursive representations based on a Max-Min configuration. The article introduces and analyzes a structure that is combined with a time-varying multiple discounts. This setup contributes to the understanding of the much discussed present biases.  A representation result for robust orders is also presented.