Thomas Seegmuller | Aix-Marseille University (original) (raw)

Papers by Thomas Seegmuller

Documents De Travail Du Centre D Economie De La Sorbonne, 2007

In past years, imperfect competition has been introduced in several dynamic models to show how ma... more In past years, imperfect competition has been introduced in several dynamic models to show how mark-up variability, increasing returns (decreasing marginal cost), and monopoly prots aect the occurrence of endogenous uctuations. In this paper, we focus on another possible feature of imperfectly competitive economies: consumers' taste for variety due to endogenous product diversity. Introducing monopolistic competition , ) in an overlapping generations model where consumers have taste for variety, we show that local indeterminacy can occur under the three following conditions: a high substitution between capital and labor, increasing returns arbitrarily small and a not too elastic labor supply.

Annales D Economie Et De Statistique, Feb 1, 2004

Working Papers of Beta, 2001

Recherches économiques de Louvain, 2003

International Journal of Economic Theory, 2005

We analyze the stabilizing role of imperfect competition on uctuations due to indeterminacy and e... more We analyze the stabilizing role of imperfect competition on uctuations due to indeterminacy and endogenous cycles. In this paper, imperfect competition is a source of monopoly prots, because of producer market power. Considering an overlapping generations model with capital accumulation and elastic labor supply, we show that under imperfect competition, the emergence of endogenous uctuations requires a weaker substitution between production factors than under perfect competition. In this sense, imperfect competition stabilizes uctuations. However, we nd an opposite conclusion concerning the elasticity of labor supply. Indeed, endogenous uctuations are compatible with a less elastic labor supply under imperfect competition.

Macroeconomic Dynamics, 2008

Japanese Economic Review, 2009

In macroeconomics, economists introduce most frequently imperfect competition on product markets ... more In macroeconomics, economists introduce most frequently imperfect competition on product markets using the monopolistic competition model. However, by assumption, this framework ignores one important feature of imperfect competition: strategic interactions between producers. Taking into account this remark and following Yang and Hejdra (1993), this paper analyzes an overlapping generations model where strategic interactions between producers are introduced and examines how they aect the stability properties of the steady state. Because of free entry, strategic interactions between producers imply a new dynamic feature, mark-up variability, promoting indeterminacy and endogenous cycles. Indeed, in contrast to the model without strategic interaction, endogenous uctuations can occur when the substitution between the production factors, capital and labor, is not too weak, but in accordance with empirical estimates. JEL classication: D43, E32.

Macroeconomic Dynamics, 2016

Working Papers, Oct 19, 2011

We re-examine the destabilizing role of balanced-budget fiscal policy rules based on consumption ... more We re-examine the destabilizing role of balanced-budget fiscal policy rules based on consumption taxation. Using a one-sector model with infinitely-lived households, and assuming that preferences are of the Greenwood-Hercovitz-Huffman [8] (GHH) type, we show that non-linear consumption taxation may destabilize the economy, promoting expectation-driven fluctuations, if the tax rate is countercyclical. We also exhibit a Laffer curve, which explains the multiplicity of steady states when the tax rate is counter-cyclical. All these results are mainly driven by the absence of income effect. Finally, a numerical illustration shows that consumption taxation may be a source of instability for most OECD countries.

Documents De Travail Du Centre D Economie De La Sorbonne, 2008

The aim of this paper is to study the role of progressive tax rules on the steady state and the s... more The aim of this paper is to study the role of progressive tax rules on the steady state and the stability properties in a Ramsey economy with heterogeneous households and borrowing constraints. Since labor supply is elastic, considering different tax rates on capital and labor incomes matters. Showing the existence of steady states where only the most patient households hold capital, we argue that working could not be optimal for them. Dynamics are addressed through a local analysis. In contrast to many contributions, progressive tax rules can promote expectation-driven fluctuations and endogenous cycles. Hence, progressivity can be an inopportune device to stabilize macroeconomic volatility.

We consider an overlapping generations model with environment, where we introduce an elastic labo... more We consider an overlapping generations model with environment, where we introduce an elastic labor supply. In this framework, consumers have to choose between consumption, environmental quality and leisure. We establish that several steady states can coexist, even under a Cobb-Douglas technology, and we put in evidence a non monotonic relationship between pollution and per capita income, as suggested by the Environmental Kuznets Curve. Moreover studying local dynamics, we show the existence of deterministic cycles and endogenous uctuations due to self-fullling expectations.

Documents De Travail Du Centre D Economie De La Sorbonne, 2009

In his seminal contribution, shows that an overlapping generations economy may monotonically conv... more In his seminal contribution, shows that an overlapping generations economy may monotonically converges to a steady state with a positive rational bubble, characterized by the dynamically ecient golden rule. The issue we address is whether this monotonic convergence to an ecient long-run equilibrium may fail, while the economy experiences persistent endogenous uctuations around the golden rule. Our explanation leads on the features of the credit market. We consider a simple overlapping generations model with three assets: money, capital and a pure bubble (bonds). Collateral matters because increasing his portfolio in capital and bubble, the household reduces the share of his consumption paid by cash. From a positive point of view, we show that the bubbly steady state can be locally indeterminate under arbitrarily small credit market imperfections and, thereby, persistent expectation-driven uctuations of equilibria with (rational) bubbles can arise. From a normative point of view, monetary policies that are not too expansive, are recommended in order to rule out the occurrence of sunspot uctuations and enhance the welfare evaluated at the steady state. Résumé Dans son inuente contribution, Tirole (1985) montre qu'une économie à générations imbriquées peut converger de façon monotone vers un état stationnaire avec une bulle rationnelle, caractérisé par la règle d'or dynamiquement ecace. La question qui nous intéresse est d'étudier si cette convergence monotone vers un état de long terme ecace peut être remise en cause, l'économie connaissant des uctuations endogènes persistentes autour de la règle d'or. Notre explication est basée sur les caractéristiques du marché du crédit. Nous considérons un modèle à générations imbriquées simple avec trois actifs : la monnaie, le capital et une bulle (obligation). Le collatéral joue un rôle parce qu'en augmentant son portefeuille en capital et bulle, le consommateur réduit la part de sa consommation nancée par la monnaie. D'un point de vue positif, nous montrons que l'état stationnaire avec bulle peut-être localement indéterminé pour de faibles imperfections du marché du crédit et, ainsi, des uctuations dues à la volatilité des anticipations avec une bulle (rationnelle) peuvent émerger. D'un point de vue normatif, des politiques monétaires qui ne sont pas trop expansives sont recommendées pour éliminer les uctuations dues aux anticipations auto-réalisatrices et augmenter le bien-être à l'état stationnaire.

We revisit the seminal paper on endogenous fertility by taking into account households' heterogen... more We revisit the seminal paper on endogenous fertility by taking into account households' heterogeneity in terms of capital endowments, mortality differential and cost per surviving child. Focusing on an endogenous growth version, we show at first that there exists a unique balanced growth path (BGP) where the population growth rates of all dynasties are identical. Then, we study the long-run effects of shocks on mortality rates (such as epidemics), mortality differential and total factor productivity (TFP) on the economic and demographic growth rates. The main mechanism rests on the adjustment of the average rearing cost of a surviving child. Finally, we extend the model considering the effects of labor taxation. We find that a higher tax rate may, on the one side, enhance growth but, on the other side, raise wealth inequalities.

We consider a constant returns to scale, one sector economy with segmented asset markets, encompa... more We consider a constant returns to scale, one sector economy with segmented asset markets, encompassing both the Woodford (1986) and overlapping generations models. We analyze the role of public spending, financed by (labour or capital) income and consumption taxation, on the emergence of indeterminacy. We find that what is relevant for indeterminacy is the variability of the distortion introduced by government intervention. We further discuss the results in terms of the level of the tax rate, its variability with respect to the tax base and the degree of externalities in preferences due to the existence of a public good. We show that the degree of public spending externalities affects the combinations between the tax rate and its variability under which indeterminacy occurs. Moreover, in contrast to previous results, we find that consumption taxes can lead to local indeterminacy when asset markets are segmented.

We provide a general methodology to study the role of market distortions on local indeterminacy a... more We provide a general methodology to study the role of market distortions on local indeterminacy and bifurcations. We extend the well-known Woodford (1986) model to account for market distortions, introducing general specifications for three crucial functions: the real interest rate, the real wage and the workers' offer curve. The elasticities of these three functions play a key role on local dynamics and allow us to identify which types of distortions are the most powerful for indeterminacy.

While most of the literature concerned with indeterminacy and endogenous cycles is based on the r... more While most of the literature concerned with indeterminacy and endogenous cycles is based on the restrictive assumption of a representative consumer, some recent contributions have investigated the role of heterogeneous agents in dynamics. This paper adds to this latter strand of the literature by highlighting the effects of heterogeneity in consumers' preferences within an overlapping generations economy with capital accumulation, endogenous labor supply and consumption in both periods. Using a mean-preserving approach to heterogeneity, we show that increasing the dispersion of propensity to save decreases macroeconomic volatility, by narrowing down the range of parameter values compatible with indeterminacy and ruling out expectations-driven fluctuations under a sufficiently large heterogeneity.