Theory of Economic Growth

By Michio Morishima | Go to book overview

XVI Simultaneous Optimization of Population and Capital

1. How much of its income should a nation save? This problem of optimum savings has been discussed by Ramsey on the assumption of a constant population and later by a number of economists on the more general assumption that the labour force expands at a constant rate exogenously fixed. Different rates of population growth lead to different solutions; that is to say, the path of optimum capital accumulation is relative to the population growth.

On the other hand, Meade and others have been concerned with the problem of optimum population, assuming among other things that at any given time the economy is provided with a given rate of savings as well as a given stock of capital equipment to be used. 1 It follows that the path of optimum population is relative to capital accumulation. In fact a population growth that is optimal in some circumstances would be too fast in other circumstances—say, when capital is accumulated at a very low rate.

It is evident that these two partial optimizations procedures should be synthesized so as to give a genuine supreme path which is an optimum with respect to both capital and population. We devote this final chapter to a generalization of the Ramsey-Meade problem in that direction and show that two kinds of long-run paths—efficient and optimum paths—will under some conditions converge to the Golden Growth path when the time-horizon of the paths becomes infinite. Efficiency is defined in terms of the 'final' outcomes of paths, while optimality takes into account not only the final states but also intermediate states en route. Two long-run tendencies we shall derive may be regarded as extensions of those discussed in the chapters entitled First and Second Turnpike Theorems.

2. In the previous chapter, the Silvery or Golden Equilibrium has been compared, for efficiency and Pareto Optimality, with feasible paths starting from an initial position from which the economy can grow in equilibrium without discarding any labour but possibly discarding some goods. 2 It is

-289-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this book

This book has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this book

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited page

Bookmark this page
Theory of Economic Growth
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen
/ 314

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.