382 PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA - 28 
the period of production, in the case where ®,6=4, is only of 
the order of 36%, the difference i - p being some 25%. 
It is only for capital-output ratios below 1.5, i.e. very low 
ones indeed, that gains of real income could be very appre- 
ciable: but in any case for which estimates has been avail- 
able no such low values of yc have been met. 
Clearlv it follows that: 
r) developed economies have relatively little to gain from an 
increase in Savings, 
2) that less developed countries, on the contrary, can realise 
substantial gains from greater savings efforts when the mar- 
ginal productivity of capital is very high, but that these 
gains are however not as large as is generally believed. 
Significance of the Results Obtained 
411. It can thus be seen that the real income gains which 
can be had by lengthening the average duration of the capita- 
listic process are in general overestimated, not to sav consider- 
ably overestimated. 
But a basic assumption of the model should be borne in 
mind when making this interpretation. This is that there is 
optimum management in all the situations considered, implying 
that existing savings are utilised in the best possible way. 
‘Paretian optimum hypothesis) (1). 
This being so, although the results derived above show 
that greater savings would not be very advantageous in an 
economy in which there is optimum management, they in 
no way imply that increased savings would not be very pro- 
ductive if savings already accumulated had in the past been 
invested in mistaken directions. 
(1!) 
§ 
II7 
"111 Allais - pag. 186