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Consider a Solow economy F(K,N)=zK^1/3 N^2/3 with parameters d = 0.1, s=0.4, N0 =200, and z=2.0. Suppose K=600 in P0 and the period is one
Consider a Solow economy
F(K,N)=zK^1/3 N^2/3
with parameters d = 0.1, s=0.4, N0 =200, and z=2.0. Suppose K=600 in P0 and the period is one year. In contrast to the norm, we assume that the population growth Rate n in this example is endogenous
(1+n) = N'/N = g(C/N)=(C/N)^3
- dynamics per worker capital k
- per capita quantities k,y,c and Aggreatebquantities for k,y,c of capital stock, consumption and output for years 1-5
- find k* steady state per-capital stock, consumption per capita c* and output per capita y*
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