buletin ştiin ific - Facultatea de Stiinte Economice - Universitatea din ...

Employment of labor in models of economic growthIn Harrod-Domar type monosectorial models, and others alike (Alezander, Smithies,Kaldor, Desenberry, Kohn, J. Robinson), employment is seen as a resource adapted toautomatically use the full requirements of such assets.Employment assumption is satisfied only in a particular case, respectively, when thedemographic rate of growth, which determines the exogenous labour, is equal to the stock ofcapital rate of growth and the income increase.Solow-type models are based on the assumption that growth rates are proportionally tothe national income and total population. In this type of models, the influence of economicfactors, income, the demographic growth and intermediate, over the employment, leads to thesolution that the population increase rate is adjusted automatically, depending on the real salary.It is considered a function of aggregate production, with two factors of production(technical capital K, and labour L), which yields marginal decrease of the factors of production,efficiency of scale which comply the Inada four conditions:Y = F (K, L) - the productionInada conditions:∂F2 2> 0; ∂ F / ∂K< 0;∂L∂F2 2> 0; ∂ F / ∂L< 0;∂KF(λ K,λL)= λF(K,L),pentruλ> 0.lim( F ) = lim( F ) = ∞K →0L→0lim ( F ) = lim( F ) = 0K →∞kkL→∞LLThe condition which yields a consistent scale involves a function of production (income)as follows:Y / L = F (K / L, L / L) Y = LxF (K / L, 1) = Lxf (k)Where:k = K / L (capital stock per capita);y = Y / L (production, income per capita).The function of production will be: y = f (k)The model takes into account a closed economy with a single sector, where output (Y) ishomogeneous, it is intended for consumption (C) or investment (I) to create new units oftechnical capital (k) savings is equal to investment ( I = S). If part of income comes from savings(s constant and positive), then 1 - s is the fraction that is consumed. The capital is subject to aconstant and positive depreciation rate.I=S= sxY = sxF (K, L);∆ K = investmens − depreciation = sxF(K,L)− δxK(K means his K derived in relation to the time period t)2. Population growth and the economic growth processAssume that population and labour forces grow at the same rate constant n. To explainthe status of stationary Solow model with population growth, we should analyze how thepopulation growth affects the accumulation of capital. Investments increase the stock of capitaland depreciation of investments falls. If the number of workers increases and K is constant, thanthe capital/ worker decreases.83