The linearised Hamiltonian as comprehensive NDP
For guidance in determining which items should be included in comprehensive NDP and how they should be included, reference is often made to the linearized Hamiltonian from an optimal growth problem. This note shows how the heuristic linearized-Hamiltonian argument can be given a rigorous welfare justification in terms of a money-metric utility function that is "naturally normalized" to be conformable with consumption at the time, of measurement. The implied normalization is of the same type as is required to interpret the "area under the demand curve" as a constant-dollar-denominated true measure of consumer's surplus. The concept of the "sustainability-equivalence principle" is explained, and is indicated why this principle is of basic importance for the theory of national income accounting.
(This abstract was borrowed from another version of this item.)
Volume (Year): 5 (2000)
Issue (Month): 01 (February)
|Contact details of provider:|| Postal: Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK|
Web page: http://journals.cambridge.org/jid_EDE
When requesting a correction, please mention this item's handle: RePEc:cup:endeec:v:5:y:2000:i:01:p:55-68_00. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Keith Waters)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.