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Recycling and endogenous cycles

Abstract : This article investigates the conditions under which deterministic cycles can emerge in a discrete-time model with infinitely lived agents and when the economy is characterized by two sectors producing two perfectly substitutable goods: a virgin good and a recycled one. The occurrence of deterministic fluctuations rests upon the countercyclical behavior of the recycling industry: an increase in present consumption implies a lower future waste activity together with a lower agents' total income, yielding a decline in next period consumption.
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Mouez Fodha, Francesco Magris. Recycling and endogenous cycles. The Economic Research Guardian, 2012, 2 (2), pp.241-250. ⟨insu-00925701⟩

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