Consider the Malthusian growth model. Recall that upper-case variables denote aggregate variables, lower-case variables denote per...

 

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Consider the Malthusian growth model. Recall that upper-case variables denote aggregate variables, lower-case variables denote per worker (or per capita) variables, and denotes the future period. In the Malthusian model, aggregate production is determined by Y = F(L.N), and population evolves endogenously as a function of consumption per worker: i.e.. = g(c). (a) Suppose the aggregate production function takes the following functional form: Y = L¹/2N¹/2 and that population evolves according to this functional form: N' N Using the procedure outlined in your notes, show that the following is true in the steady state equilibrium: = (1/2) = 1 1 N' = L:² Consider the Malthusian growth model. Recall that upper-case variables denote aggregate variables, lower-case variables denote per worker (or per capita) variables, and denotes the future period. In the Malthusian model, aggregate production is determined by Y = F(L.N), and population evolves endogenously as a function of consumption per worker: i.e.. = g(c). (a) Suppose the aggregate production function takes the following functional form: Y = L¹/2N¹/2 and that population evolves according to this functional form: N' N Using the procedure outlined in your notes, show that the following is true in the steady state equilibrium: = (1/2) = 1 1 N' = L:²

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a The steady state equilibrium for the Malthusian growth model can be derived as follows Let Y be the aggregate production and L and N be the aggregat... View the full answer