Overlapping generations model: Difference between revisions

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{{For|the topic in population genetics|Overlapping generations}}

An '''overlapping generations model''', abbreviated to '''OLG model''', is a type of representative agent [[economics|economic]] model in which [[Agent (economics)|agents]] live a finite length of time long enough to overlap with at least one period of another agent's life. As it models explicitly the different periods of life, - such as schooling, working or retirement periods --, it is the natural framework to study the allocation of resources

across the different generations.

== History ==

The concept of an OLG model was inspired by [[Irving Fisher]]'s monograph ''The Theory of Interest''.<ref name="ABB29" >{{harvtxt|Aliprantis|Brown|Burkinshaw|1988|p=229}}:<p>{{cite book|last1=Aliprantis |first1=Charalambos&nbsp;D.|authorlink1=Charalambos D. Aliprantis| last2=Brown|first2=Donald&nbsp;J.|last3=Burkinshaw|first3=Owen|title=Existence and optimality of competitive equilibria|chapter=5 The overlapping generations model (pp.&nbsp;229–271)|publisher=Springer-Verlag|___location=Berlin|date=April 1988|edition=1990 student|pages=xii+284|isbn=3-540-52866-0|mr=1075992}}</ref> Notable improvements were published by [[Maurice Allais]] in 1947, [[Paul Samuelson]] in 1958, and [[Peter Diamond]] in 1965. Books devoted to the use of the OLG model include [[Costas Azariadis|Azariadis]]' Intertemporal Macroeconomics<ref>{{Cite web|title = Wiley: Intertemporal Macroeconomics - Costas Azariadis|url = http://eu.wiley.com/WileyCDA/WileyTitle/productCd-1557863660.html|website = eu.wiley.com|accessdate = 2015-10-24}}</ref> and [[David de la Croix|de la Croix]] and [[Philippe Michel (economist)|Michel]]'s Theory of Economic Growth.<ref>{{Cite web|title = A Theory of Economic Growth - 9780521001151 - Cambridge University Press|url = https://www.cambridge.org/asia/catalogue/catalogue.asp?isbn=9780521001151|website = www.cambridge.org|accessdate = 2015-10-24}}</ref>

==Basic model==

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* {{cite book |last=Romer |first=David |year=2006 |edition=3rd |chapter=Infinite-Horizon and Overlapping-Generations Models |title=Advanced Macroeconomics |___location=New York |publisher=McGraw Hill |pages=47–97 |isbn=0-07-287730-8 }}

* {{cite journal |last=Weil |first=Philippe |year=2008 |title=Overlapping Generations: The First Jubilee |journal=[[Journal of Economic Perspectives]] |volume=22 |issue=4 |pages=115–34 |doi=10.1257/jep.22.4.115 }}

* Azariadis, Costas (1993), "Intertemporal Macroeconomics", Wiley-Blackwell, ISBN: 978-1-55786-366-9.

* de la Croix, David; Michel, Philippe (2002), "A Theory of Economic Growth - Dynamics and Policy in Overlapping Generations", Cambridge University Press, ISBN-13: 9780521001151.

{{Macroeconomics}}