Long run a countrys standard of living increases with

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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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