ECON 2 Lecture 6: Productivity Models and Interest Rates
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Econ 2 lecture 6: productivity models and interest rates. Until about 1800, we didn"t know what caused poverty or how to alleviate it. English poor laws in 1601, granted tax money to the local poor. Around 1800, poverty increased in england because of the napoleonic wars. There was discussion in england to make poverty laws a national thing. In 1798, thomas malthus published the "an essay on the principle of population", Malthus believed that the proposals would inevitably be counter-productive. He proposed that population grew at an exponential rate while food production grew by a constant amount, which meant that eventually there would be more people than we could possibly feed. While this turned out to be partly wrong, his ideas are still used in certain ways nowadays. Since malthus predicted that food production (output) grows by a constant amount and population (labor) grows exponentially, the output curve forms this shape.
