ABSTRACT

This chapter considers how the growth rate of the working population might affect the standard of living. Changes in the standard of living may thus affect specific mortality and fertility rates and thus both the dependency ratio and the growth rate of the population. The chapter discusses the mechanistic assumption that savings proportions may be affected by the standard of living of the population making the savings. It proceeds to build a large number—no less than a dozen—models of an economy in a state of steady growth in which both the proportion of income saved and the rate of growth of population are affected by the standard of living. The chapter argues that the proportion of income saved rises with the standard of living. It turns to the cases in which the elasticities of substitution between the factors are all still numerically equal to unity, but in which the economy is institutionally a Plantcap.