SEMAINE D'ÉTUDE SUR LE ROLE DE L’ANALYSE ECONOMETRIQUE ETC.

1

TX ITIONG

AND ASSUMPTIONS

505

We shall carry out our analysis under the assumption of
a closed economy consisting of two sub-sectors, a private sector
and a public, or government, sector. We shall need the following
 variables in the models to be considered.

(1) x(t) = total net national product
(2) «xp(t) = part of x consumed by private sector
3) xo(" - part of x consumed by public sector (« collective
consumption »)
(4) ke(t) = part of x representing private net investment
(5) Ro({\ = part of x representing public net investment
(6) RC, Rp(t) + Rolf)
(7 K total stock of productive capital of all kinds, in
the whole economy
disposable income of the private sector
rate of total government deficit spending

(8) w(t
(9) ml

All variables are to be regarded as in constant prices
Except for K, the variables are all flows, i.e. they have tae
dimension of « per unit of time ». More information concerning
 the meaning ascribed to the variables is given implicitly
by the following definitional relations (using hereafter the sim
pler notation of x, xp, etc. instead of x(£), xp(: -* °

2.1)

(2.2)

(2.7)

Haavelmo - pag.