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le the human capital increases at a constant speed, on another hand, u is decreasing while v is developing on the opposite direction, therefore, the assumption goods reduce by u while the community products escalate by gvH which is bigger than u. To sum up, what has been mentioned above together with the equation formula Y=C+I+G+NX(Dornbusch, Fischer, Si Tanzi, 2007.) leads to the reduction of C as well as the growth of G ( nevertheless, all the other elements remain the same).

 
ii. suppose that v increases with u held constant. Determine the effects on the level and the rate
of growth of consumption. Draw a diagram showing the initial path followed by the natural
logarithm of consumption and the corresponding path after v increases

The curve will at first descends vertically and ascends slowly, ending up in go beyond the former result.
.△v>0，△u=0, hence l-u-v decreases, the speed of the increase of the human resource capital decreases at the same time, contributing to the result that the assumption goods remain the same while the community products keeps increasing, which finally leads to the growth of the output and the more and more decreasing speed of its growth ratio. When the speed’s increasing is reduced to zero and arrives at a balanced state, the assumption goods increase at the very first but remain stable at the very last.

 

iii. Explain your results and any difference between parts 2(b)i and 2(b)ii.
In the comparison i with ii, we can find out that the major difference is that △u and △v are a pair of counterpart in their relationship in the model of i, while ii does not work in that way, hence comes out the diversified consequences.

(c) Suppose the government makes a one-time investment in new state school buildings, which results in a one-time reduction in consumption. The new buildings increase the efficiency with which human capital is accumulated. Determine the effects of this on the paths of aggregate consumption and aggregate output over time.

The final result is the increase of the whole assumption goods.
From the Endogenous Economy Model of Lucas, we can arrive at the conclusion that, the human capital, situating at a centered position, is a very important element in stimulating the social economy. Government has increased investment in education, aiming in improving the stock of the human capital in terms of knowledge and skills, which, in another word, lays a solid foundation for the development of the human capital as well as its full use(Jagdish Handa,  2000; Eckhard Siggel, 2005). By this way, although the popularity of the construction of school buildings will reduce the assumption output in the short term, it will increase the accumulation productivity and speed ration of the human resource capital and will enlarge the accumulative quantity of the human resource quickly in the long run, which will attribute to the high-speed development of our economy as well as the substantial increase of the assumption level in general and the output in total, that is to say, i increases while c goes down, with the implied meaning of the subject, H（t）’s increase will lead to the growth of the output at the very last, to go further, the assumption level c in general will work in the same way (Philippe Aghion, Peter Howitt, Maxine Brant-Collett,1998).

(d) Reinterpret the endogenous growth model as follows. Suppose there are two groups 本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。