Optimal Economic Growth and Non-Stable Population

ISBN-13: 9783540515562 / Angielski / Miękka / 1989 / 219 str.

Evert Van Imhoff; E. Van Imhoff

Opis

This book studies optimal economic growth in a closed economy which experiences non-stable population growth. The economy is described by means of a neoclassical growth model which distinguishes overlapping generations within the population. The basic neoclassical growth model is extended to include various types of technical change, as well as investment in human capital or education. The research described in this book connects the analytical tools of traditional growth theory with the actual demographic experience of most industrialized countries. The role of demographic processes in the growth theoretical literature is discussed in the next section. The discussion will show that growth theory needs to extend its scope through the construction of growth models which explicitly recognize demographic forces as a potential source of non-stationarities. This book constitutes a first attempt at such a demographic extension. 1.1 Growth theory and demographic change The theory of economic growth (e.g. Solow, 1970; Burmeister & Dobell, 1970; Wan, 1971) attempts to describe and to explain the long-run development of an economic system (or, in short, economy). An economic system is essentially dynamic in nature. Among the most important sources of dynamics in economics are the following: accumulation of capital (investment); technical change; population growth. Some of these dynamic forces are, at least in part, endogenous to the economic system (i.e. determined by economic variables)."

Spis treści

1 Introduction.- 1.1 Growth theory and demographic change.- 1.2 Optimal economic growth.- 1.3 Population dynamics and economic development.- 1.4 Research goals and outline of the book.- 2 Optimal economic growth in the simple one-sector growth model.- 2.1 The simple one-sector growth model.- 2.1.1 Population and labour.- 2.1.2 Production and investment.- 2.1.3 Social welfare.- 2.2 The Non-Stationary Golden Rule.- 2.3 Comparative statics and the Golden Rule.- 2.4 Optimal population growth.- 2.5 The non-stationary optimal growth path.- 2.6 Summary.- 3 Technical change and economic growth.- 3.1 On the concept of technical change.- 3.2 Classifications of technical change.- 3.2.1 Exogenous vs. endogenous technical change.- 3.2.2 Neutral vs. biased technical change.- 3.2.3 Embodied vs. disembodied technical change.- 3.3 Technical change in one-sector growth models.- 4 Optimal economic growth under conditions of technical change.- 4.1 A model with exogenous disembodied technical change.- 4.1.1 The Generalized Golden Rule.- 4.1.2 Comparative statics.- 4.1.3 The non-stationary optimal growth path.- 4.1.4 Summary.- 4.2 A model with exogenous embodied technical change Contents.- 4.2.1 The fixed-coefficients capital vintage model.- 4.2.2 Optimal economic growth.- 4.2.3 Comparative statics.- 4.2.4 Stability of steady states.- 4.2.5 Second-order conditions.- 4.2.6 The non-stationary optimal growth path.- 4.2.7 Summary.- 4.3 A model with endogenous technical change.- 4.3.1 The Golden Rule of Research.- 4.3.2 Comparative statics.- 4.3.3 The non-stationary optimal growth path.- 4.3.4 Summary.- Appendix to Chapter 4.3.- 5 Education and economic growth.- 5.1 Economics and education.- 5.2 Education as a production process.- 5.2.1 Educational outputs.- 5.2.2 Educational inputs.- 5.2.3 Functional form.- 5.3 Selection of models.- 6 Optimal economic growth and investment in education.- 6.1 A model with homogeneous human capital.- 6.1.1 Homogeneous human capital in a model of overlapping generations.- 6.1.2 Optimal investment in education.- 6.1.3 Comparative statics.- 6.1.4 The non-stationary optimal growth path.- 6.1.5 Summary.- 6.2 A model with heterogeneous human capital.- 6.2.1 Optimal control with integral state equations and bounded controls.- 6.2.2 The model with two types of labour.- 6.2.3 Optimal economic growth.- 6.2.4 Comparative statics.- 6.2.5 Dynamics.- 6.2.6 Summary.- 7 Optimal educational policy under conditions of technical change.- 7.1 Education and exogenous disembodied technical change.- 7.1.1 Optimal investment in education.- 7.1.2 Comparative statics.- 7.1.3 Summary.- 7.2 A model with education as transmitter of technical change.- 7.2.1 Education and labour-embodied technical progress.- 7.2.2 Optimal economic growth.- 7.2.3 Comparative statics.- 7.2.4 The non-stationary optimal growth path.- 7.2.5 Summary.- 8 Simulations for the Netherlands.- 8.1 Demographic data.- 8.2 Simulation for the model with homogeneous human capital.- 8.3 Simulations for the model with heterogeneous human capital.- 9 Summary and evaluation.- 9.1 Summary.- 9.2 Evaluation.- References.- Author index.