ps6a_114

ps6a_114 - Econ 114 Javier Birchenall Due date Tuesday...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Econ 114 Javier Birchenall Due date: Tuesday, November 23, 2010 Problem set 6: Government and economic growth The following problem set studies the e f ect of government spending on the Solow model. You will show that under government provision of capital, it is optimal to have a government of a limited size. The problem is basedonprob lem12 .4ofthetextbook .P lantospend4hours on these questions. Please return the problem set on time (next Tuesday during class), remember you have the chance to miss one and only one, use it wisely. If you have any problems regarding the questions please contact me by e-mail: [email protected] .Good luck! I. (100%) Government capital Consider an extension of the Solow model from Chapter 3 to encompass a second type of capital, called government capital, which consists of publicly funded infrastructure such as roads and ports. Let denote the quantity of government capital per worker, the quantity of physical capital per worker, and the quantity of output per worker. The economy’s production function (in per-worker terms) is = 
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 01/10/2011 for the course ECON 114 taught by Professor Cindybenelli during the Fall '08 term at UCSB.

Page1 / 3

ps6a_114 - Econ 114 Javier Birchenall Due date Tuesday...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online