ABSTRACT
The paper considers a multisector model of intertemporal allocation with a primary factor of production and the overtaking criterion of optimality. The optimal program is characterized in terms of (i) period-by-period conditions on intertemporal profit and utility maximization relative to a system of competitive prices and (ii) non-positivity of appropriately computed values of differences of stocks from the golden rule stock: The last condition replaces the usual transversality condition of Malinvaud and throws new light on the possibility of decentralization in an infinite-horizon economy. Journal of Economic Literature Classification Numbers: 020, 022, 027, 110, 111, 112, 113. © 1988 Academic Press, Inc.
