Steady State Growth Paths in a Continuously Overlapping Generations Model

In a continuously overlapping generations model with technical progress steady states require Cobb-Douglas of log-linear utility functions if labor is treated explicitly as a decision variable of the individuals. Only in the absence of technical progress the preferences may be arbitrary. The golden rule of accumulation implies an equilibrium where either there is no outstanding debt of all living generations or all individuals do not save. The latter case is not implementable, because without saving capital accumulation is impossible. Even the first case can be unfeasible because the equilibrium price system requires r ≠ wK. Therefore the practicability of the golden rule is only a matter of chance