Study week on the econometric approach to development planning

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Monograph

Identifikator:: 1824422792

URN:: urn:nbn:de:zbw-retromon-217476

Document type:: Monograph

Title:: Study week on the econometric approach to development planning

Place of publication:: Amsterdam [u.a.]

Publisher:: North-Holland Publ. Co. [u.a.]

Year of publication:: 1965

Scope:: XLVII, 1259 S.; graph. Darst.

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: On the concept of optimal economic growth / Tjalling C. Koopmans, Cowles Foundation for research in Econimics at Yale University New Haven, Conn. - U.S.A.

Collection:: Economics Books

254 PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 28 Let us assume for the sake of argument that the present model is representative enough to be looked on as a tentative test of the applicability of the ethical principles under consi- deration. Then we have just managed to avoid discriminating against future generations on the basis of remoteness of the time at which they live. However, this close escape for virtue was possible only by making welfare comparisons on a per capita basis. If instead we should want to weight per capita welfare by population size, then we are forced to discriminate on the basis of historical time by positive discounting. There seems to be no way, in an indefinitely growing population, to give equal weight to all individuals living at all times in the future. This dilemma suggests that the open-endedness of the future imposes mathematical limits on the autonomy of ethical thought. The suggestion may come as a shock to welfare economists, because no such logical obstacles have been encountered in the more fully explored problems of allocation and distribution for a finite population. It is true that the mere fact that we are considering an infinite number of people does not fully explain the dilemma. For Ramsey was able, albeit by artifi- cial assumptions, to indicate a fair solution to the problem for the infinite future of a population of constant size. Our dif- ficulty is therefore connected with the assumption of an inde- finite growth in the population. The following reasoning may further illuminate the reasons for the nonexistence of an optimal path with negative p. As- sume that 0>>p>f (2) - A. (Of course, p= - À would correspond to equal weights given to the utilities of all individuals. How- ever, f(z) -A>-X, and our illustration is simpler if we do keep 2(p)<<z by taking p>f(z) - ». Consider now an optimal path for the finite time period 0<¢<T, defined by initial and terminal per-worker capital stock levels z,=2r=2 both equal to that level £ which, if maintained at all times, would secure the maximum maintainable consumption per head. The analy- F4] Koopmans - pag. 30

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