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"Many applications in economics require the selection of an objective function which enables the comparison of allocations involving different population sizes. The two most commonly used criteria are the Benthamite and the Millian welfare functions, also known as classical and average utilitarianism, respectively. The former maximizes total utility of(More)
Considerable literature exists upon the effect of population growth upon per capita income growth. Among the reported studies, Brander and Dowrick (1994) try to explain the large variation across countries in per capita income growth. The authors explore the possibility that even with little differences in fertility rates, different countries may(More)
This paper examines the dynamic properties of a monetary endogenous growth model in which money is introduced into the system via a transactions-cost technology. A monetary equilibrium that either satisfies the Friedman rule of the optimum quantity of money or accommodates the zero-inflation-rate policy is dynamically unstable. In a Cagan-like(More)
Labor taxes and unemployment compensation were blamed for causing relative declines in labor supply in the EU to the US in the past decades. We propose a model with an endog-enous labor force and compare with the model with an exogenous labor force. Because of discouraging the labor force, labor taxes decrease employment in our model less than the model(More)
In a cash−in−advance economy where cash is required in advance of purchasing both consumption and investment goods, we find that active interest rate rules generate equilibrium uniqueness, but passive rules can lead to real indeterminacy. Simulation shows that even in the presence of investment, passive rules are very likely to render indeterminacy.
In this paper, we consider a two-sector, dynamic model of an economy in which one of the sectors are growing through learning by doing while the other one is stagnant along an autarkic balanced growth path. The resulting declining relative price thus implies that accelerated industrialization through production subsidy could improve the lifetime welfare of(More)