Messages

To those who wrote a small essay from the problem set 6: I have read your answers, and made some comments to each of you. You will find the papers outside my office on Monday morning (May 18), but not too early! Good luck with the exam!

I have produced a short note as answer to problem 3 in Seminar Set 5 (MSG-model). You find it under Teaching Material.

Due to some objection at the last lecture, claiming that the model was incorrectly specified, I have produced "Hand-out 8 - a supplement", showing that the one outlined in Lecture Note #8 is correct - it is immaterial to the trade-offs whether we discount back to the beginning of the first period or to the beginning of the second period. You find the supplement under Teaching Material.

During a few days I will provide to you a small note related to Problem 3, seminar 5.

You might find it in your interest to write a small paper on one of the problems from the last seminar. I suggest the following: Write either individually or in cooperation with a good friend at the course, a "short paper" on one of the topics in Problem 1, 3 or 4 (NOT Problem 2 - this is too extensive). The objective is that you should exercise your ability or skill in presenting a problem and the economic mechansims without putting in too much mathematics. Maximum 2 paqes on your computer or 5 handwritten pages. The time limit is Monday May 11, at 11 o'clock at my office (room 1214). I will return the papers during a few days, I hope, with some comments.

There is a confusing error in the hand-out #8 that was discovered during the lecture today. I will provide a note with the necessary corrections, even thoug the error did not have an impact on the trade-off conditions. Sorry! The correction will come tomorrow.

In a first version of hand-out 8 there was a misprint in line 4 on page 11. It should read: gamma = 0. Sorry! In the version found on the home page, the correction has been done.

I have prepared a hand-out on "Optimal Economic Growth" - hand-out 8 - which is available under Teaching Material. This note contains some material for the lecture today and also last week. Today's lecture is the last one. I have promised you to come up with a "solution" to Problem 3 from the seminar #5. Due to a very tight programme this week, I will not be able to keep my promise until next week.

Problem Set for seminar 6; in week 18 on April 30, is now available under Teaching Material. These problems are "close" to what I consider as likely formulations of the type of problem you will face on the exam. In the seminar I want a discussion about the problems - I will not come up with "correct answers".

I will also complete a hand-out about "optimal economic growth" -hopefully ready on Tuesday, next week. The problem set for the last seminar next week will be available on Thursday (April 23), after the lecture in the morning.

You find a hand-out "On Investment" - hand-out 7, under teaching material.

Problem Set for seminar 5; week 16 on April 16, is available under Teaching Material.

With Olav Bjerkholt's permission the paper "The making of the Leif Johansen Multi-Sectoral Model" is available under "Teaching material". This paper surveys the background and the structure of the original MSG-model, and is highly recommended for the lectures this week.

Due to the cancellation of the lecture on March 17, and because teaching in May becomes difficult, I go for the following plan for the remaining lectures/seminars: Tuesday March 31; 1415 - 1600 (aud 5): Disaggregated growth models and structural changes. Thursday April 2; 0830-1000 (room 1220): Disaggregated growth models and structural changes. Tuesday April 14: No lecture. Thursday April 16; 0830 - 1000 (room 1220): Seminar as planned (problems available during this week). Tuesday April 21; (aud 5): On Investment. Thursday April 23; 0830 - 1000 (room 1220): On optimal economic growth. Tuesday April 28; 1415 - 1600 (aud 5): On optimal economic growth. Thursday April 30; 0830 - 1000: Last seminar

If you find this plan unacceptable, please let me know!

I have produced two hand-outs: Hand-out #5 is a small note related to a highly relevant question from last seminar: Why is the age of the oldest equipment in use constant in equilibrium? The second hand-out, Hand-out #6, outlines a simplified version of the Schumpeterian Model og Quality Ladder in chapter 7 in Barro Sala-i-Martin. This is the topic for tomorrow's lecture. You find them under "Teaching Material"

First: A supplementary problem for the seminar next week (week 13) is available under "Teaching Material". This problem is related to the topic for the lecture on Tuesday March 26. I will provide a Lecture Note for you on "Schumpeterian Growth" - I hope it will be ready on Monday. Second: There is an error on page 3 in Lecture Note 4, the bottom line: The lower limit in the integral should be read: t-theta.

Due to the talk by Eva Joly today, at the same time we should have class, I have decided to cancel today's lecture. We will catch up later, and continue on "Endogenous Growth" next Tuesday. I am sorry if this message is coming a bit late.

I have the following proposal for the remaining lectures: The plan was to have the last lecture on April 28. However, I should like to have a lecture on May 5 as well, due to the following reason: This week (week 12) will present a model of Schumpeterian Growth with emphasis on Innovations and R&D. The next two weeks (week 13,14) will take up Leif Johansen's "Multi-Sectoral Model of Economic Growth" - see the compendium and the article by Vislie. The first lecture after Easter will be on April 21 (no lecture on Tuesday 14, but a seminar on Thursday 16!). The topic for that lecture will be "Approaches to analysing Investment". The last two lectures; April 28 and May 5 - if ok for you - will be about "Optimal Economic Growth - an Introduction". (The last seminar will is April 30.) If any objections to this plan, please let me know!

Problem Set for seminar 4; week 13 on March 26, is available under Teaching Material. I will in addition to the two problems in this set, come up with a third problem during the week.

You will find my suggestion for solvoing Problem 1 for seminar #3 today, under teaching Material. Furthermore, the paper by F?rsund and Hjalmarsson "Dynamic Analysis of Structural Change and Productivity Measurement" is also available under Teaching Material. In this paper you find a version of the Putty-clay model, very similar to the one we have discussed in lectures, and also a way of applying the derived short-run industry production function to understand productivity.

The article "Division of Labour - Simon revisited; A comment", by Vislie (1979) is now available under Teaching Material.

There is, unfortunately, a misprint on page 2; 8th line from above, in hand-out #4. It should read: The age of the oldest plant in used at t is theta,...... (To be precise: t - theta is a point in time, like a year, as t is.)

Literature related to today's lecture on "Endogenous growth" is: Barro & Sala-i-Martin: 1.3.1 -1.3.3 (pp. 61 -68), 4.2 and 4.3.1 (pp. 211 - 215), the articles by Mankiew and by Stern on the reading list.

You find a new hand-out, "The neoclasical version of the Johansen-vintage growth model", Lecture note #4, under Teaching Material. The main issue here is to see the role of wage expectations.

An additional Problem 4 for Seminar 3 next Thursday is now ready under Teaching Material. (If you find the problem hard to solve because you don't find the "door" to the right track, don't worry. However, you should at least try!)

The material that was presented in the second hour at today's lecture, is "heavy". I will, in order to compensate you, provide a small hand-out on some of the features of the putty-clay growth model. The problem I asked you to consider will be included in Problem Set 3 for the seminar next week.