We found a match
Your institution may have rights to this item. Sign in to continue.
- Title
A Synthesis of the Ramsey-Meade Problems when Population Change in Endogenous.
- Authors
Lane, John S.
- Abstract
The problem of determining the optimum savings rate through time in the context of a centrally planned economy has been studied by Ramsey under the assumption of a constant population. Later economists [1, Chapter 3] have generalized the analysis to include a population that grows at a constant exogenous rate. On the other hand Meade [6, pp. 8093] has shown us how to determine the optimum size of the population at any given moment. But the analysis pre-supposed a given rate of savings and a given stock of capital equipment at any given instant of time. Since the optimum population growth rate and the path of capital accumulation are mutually interdependent a synthesis of the two problems is required. Dasgupta [2] has shown how this joint population/savings decision can be determined but uses some very restrictive assumptions. In particular, the analysis of both Dasgupta and Meade requires that it be possible to realize the optimum population, instantaneously and without cost, at every moment of time including the present. In reality, today's population is given and so constitutes an important constraint on the development of the economy; in addition, the rate of growth of the population is in part determined by endogenous factors and so is only indirectly controllable. Our aim is to extend Dasgupta's synthesis to include these two features. It will be assumed that population growth is completely endogenous and therefore, in contrast to Dasgupta's synthesis, our purpose is to determine a second best optimal policy. Such an extension has been attempted by Sato and Davis [8] and so it is of interest to examine the connection between their analysis and the one presented here. This is done in Section 5 below.
- Subjects
DEMOGRAPHIC transition; POPULATION &; economics; DEMOGRAPHIC change; SAVINGS; ECONOMIC development; POPULATION geography; ECONOMICS; DEMOGRAPHY
- Publication
Review of Economic Studies, 1975, Vol 42, Issue 1, p57
- ISSN
0034-6527
- Publication type
Article
- DOI
10.2307/2296819