Unformatted text preview: run, a country’s standard of living
• Increases with its saving rate
• Decreases with its population growth rate • If the economy has more (less) capital than the Golden Rule level, the reducing (increasing) saving will increase consumption at all points in
time, making everyone better oﬀ.
• So far, however, we have assumed that there is no technological pregress in the economy?
• Next Step: Solow model with technological progress Soojin Kim (Purdue) Macroeconomics Spring 2014 28 / 28...
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- Spring '14
- Macroeconomics, Purdue University, Soojin Kim