Introducing realistic savings patterns in intertemporal models (Q1094313)

Discrete-time intertemporal welfare optimization models often involve the choice of discount factors whose value is determinantal, but usually unknown. In this note, we provide a general equilibrium formulation which involves intertemporal wealth transfers instead. We illustrate our approach with a simple numerical example, and show that in a convex analysis framework, it encompasses a version of the Golden Path Rule.