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Welfare, Population Growth and Dynamic Inefficiency in an OLG Framework

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  • Daniel Mulino

Abstract

In a two-period OLG framework, there is only one rate of population growth at which the competitive equilbrium outcome is also the golden rule outcome. I show that this is the welfare minimizing outcome for agents. Moreover, I show that as population growth increases beyond the welfare minimizing level, agents are better off even as the economy becomes more dynamically inef_cient.

Suggested Citation

  • Daniel Mulino, 2005. "Welfare, Population Growth and Dynamic Inefficiency in an OLG Framework," Monash Economics Working Papers 19/05, Monash University, Department of Economics.
    • Handle: RePEc:mos:moswps:2005-19
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    File URL: http://www.buseco.monash.edu.au/eco/research/papers/2005/1905twoperiodolg.pdf
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    References listed on IDEAS

    as
    1. Samuelson, Paul A, 1975. "The Optimum Growth Rate for Population," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(3), pages 531-538, October.
    2. Deardorff, Alan V, 1976. "The Optimum Growth Rate for Population: Comment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 17(2), pages 510-515, June.
    3. Samuelson, Paul A, 1976. "The Optimum Growth Rate for Population: Agreement and Evaluations," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 17(2), pages 516-525, June.
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