Exercise 11.17. Consider the Romer model presented in Section 11.4 and suppose that population grows at the
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Exercise 11.17. Consider the Romer model presented in Section 11.4 and suppose that population grows at the exponential rate n. Characterize the labor market clearing conditions. Formulate the dynamic optimization problem of a representative household and show that any interior solution to this problem violates the transversality condition. Interpret this result.
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