CONVERGENCE OF EQUILIBRIA IN AN INTERTEMPORAL GENERAL EQUILIBRIUM-MODEL

In this paper we show that searching Pareto Optima in an intertemporal equilibrium model is equivalent to solving a family of McKenzie models defined by a vector of the unit-simplex. We use Negishi's method to prove the existence of equilibria. We then extend Scheinkman's method to demonstrate that, when the discount factor of the utility functions is sufficiently near one, every equilibrium trajectory converges to a steady state.