15-05-2018: One-sector growth models with production functions
Author: E.A. Bakkum
Now that a previous column has succinctly explained production functions, the present column will present several macro-economic growth models from the book Mathematical models of economic growth of the well-known Dutch economist Jan Tinbergen. A relation will be derived between the growth rates of the economic variables (capital, labour, technical development). The starting point is the Cobb-Douglas production function. The situation with complementary factors is also studied .... Read more
02-05-2018: Dynamics in macro-economic production functions
Author: E.A. Bakkum
Until now this webportal has somwhat neglected the neoclassical production theory. The present column makes up for this omission by describing the micro-economic theory of production functions. Essential concepts such as the complementarity and the substitution of production factors are explained. The isoquant is introduced, as well as the occurrence of various types of scaling effects. The problems of macro-economic production functions, such as in the model of Solow, are addressed .... Read more
24-04-2018: One-sector models with scarce capital
Author: E.A. Bakkum
Two years ago this web portal discussed two dynamic one-sector models, which have been used in the planning activities of the former Leninist economies. In fact these are difference versions of the Harrod-Domar model, which use time dependent structure parameters. This makes the models completely dynamical. In the present column several planning instruments of the famous Dutch economist Jan Tinbergen will be explained, also based in the Harrod-Domar model. His planning models take into account the delays in investment and the replacements .... Read more
12-04-2018: The homo economicus
Author: E.A. Bakkum
All kinds of motives affect the economic activities. Economics and notably the neoclassical theory try to simplify the complex of motivations as much as possible. Often the ideal-type of the homo economicus is used, in despite of the many objections. The present column shows why this assumption is not realistic. Notably the importance of group actions and the accompanying morals or ethics are discussed .... Read more
19-03-2018: Optimization of the growth
Author: E.A. Bakkum
In many columns it has been explained how the Leninist planning agency chooses the optimal growth path, usually by means of intertwined matrices. The western economists commonly prefer to calculate the growth path by means of dynamic one-sector models. The present column describes an optimization model of the Dutch economist Jan Tinbergen, from his book Mathematical models of economic growth. The model is based on a utility function. Tinbergen concludes that such models can not determine the optimal growth, because as yet there is a lack of realistic utility functions .... Read more