Abstract
The equivalence of a perfect foresight equilibrium to a Fisher competitive equilibrium and an optimal planning model is demonstrated for a model with an adjustment cost technology and a representative household. Adjustment costs lead to a non-trivial dynamic optimization problem for the producer. The results depend on the necessity of a transversality condition for the household, producer and planner in their respective optimization problems. The equivalence theorems are used to discuss conditions for multiple steady state equilibrium solutions and the corresponding stability properties.
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