Consider how unemployment would affect the Solow growth model. Suppose that output is produced according to the following production function: = ((1 )) 1 where K is the aggregate capital stock, L is the size of the population, and u is the fraction of the people that is unemployed.1 In other words, the (1 ) expression represents the number of workers while L alone represents the number of people in total. The national saving rate is s, and capital depreciates or breaks at a rate .

Derive an expression for steady-state output per person in terms of u, , , and