Corporate How many cake-eaters? Chouette, on a du monde à dîner !
we use a cake-eating model with a non-renewable resource and a backstop technology to describe the intertemporal effect of a sudden increase of the population level, e.g. due to migration. The migrants enter an economy in which there is already surplus labor, and they receive transfers from "natives". These assumptions imply that the present discounted value of natives’ welfare falls. The counterintuitive result is that the flow of natives’ utility can increase at the time of the population change.
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|Date of creation:||2001|
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