On dynamics and the core of OG models

Stationary overlapping-generations models can exhibit fluctuations. However, the fluctuations, which have been studied by Benhabib and Day (Journal of Economic Dynamics and Control, 1982, 4, 37—55), Gale (Journal of Economic Theory, 1973, 6, 12–36) Grandmont (Econometrica, 1985, 53, 995–1046) and others, are not in the core even though they are Pareto-optimal. In the present paper, it is shown that general stationary overlapping-generation economies can have periodic equilibria in the core.