Multiple BGPs in a Growth Model with Habit Persistence
在标准竞争性增长模型中引入家庭消费对自身过去习惯的依赖，发现习惯持久性导致消费的跨期互补效应，从而产生两条平衡增长路径：一条低消费高增长，另一条高消费低增长，且两者无法帕累托排序。
This paper establishes multiple balanced growth paths in an otherwise standard, competitive growth model without externality or distortions and with households' preference dependent upon how his/her consumption compares to a habit stock formed by his/her own past consumption. The key feature in our model is that consumption forms habits in combination with existing habits. This model establishes multiple equilibria because habit persistence induces an internal, intertemporal complementarity effect among consumption flows, with current consumption reinforcing future consumption. As a result, there exist two balanced‐growth paths, with one path exhibiting low consumption and habits and high economic growth, and the other path exhibiting high consumption and habits and low growth that is not necessarily a development trap. Both steady states are saddles, but global indeterminacy arises where a high balanced growth path co‐exists with a low balanced growth path where the two equilibrium paths cannot be pareto ranked and history need not matter for the selection of the equilibrium path.