Consider an economy, which at time t = 0 is populated by L0 individuals available to work. Assume that there is no unemployment in this economy. Output, Y, is produced by Land, X, and Labour, L,, with a production technology, Y, = (Ami\"L? where A denotes land productivity. Preferences of generation t are described by U t = cf ni'l' where c, denotes consumption and n, denotes the number of children and the net birth rate at time t and y E (0,1) is a positive parameter. Members of generation t allocate their income between their consumption and expenditure on children, pnt, where p > 0 is the cost of raising a child. Hence, the budget constraint is given by pnt + C, = yr. Assume, at = 0.45, A = 1, p = 0.2, and X = 1250. Population next period depends on the number of workers in current period times the number of their children. The whole old generation dies in the next period