Download Age for Marriage

E-Growth Manual
Purpose of the Program
This program is designed to give you insight into some of the social and economic
determinants of economic growth in a country. You get to set some key social values and
then set, generation by generation, important economic variables. Over the course of (at
most) six generations, your decisions determine the way the society changes. Some
combinations lead to large, rich societies, some to small rich societies, and some to small or
large poor societies. The point is to develop an understanding of how these factors operate
in more complex societies that people actually live in.
Social Variables
Age for Marriage
One of the major differences among societies is the age at which people usually marry.
Since a major reason for considering marriage important is the relationship with
childbearing, it must be noted that there is no necessary connection between the two.
However, in most societies there is a strong causal and statistical relationship. In other
words, people have children without getting married, and get married without having
children, but mostly (for good reasons) getting married makes having children more likely.
Furthermore, for biological reasons, the younger people (especially women) get married,
the more children they can have, and the more children (on average) they will have.
Consequently, one key social variable that is set by you is the typical age for marriage in
the given society.
Few important social variables have only one effect. Changing the age of marriage may
affect more than just the number of children produced in a generation. Especially for
women, changing this variable—and therefore the age at which they have their first child—
alters the typical labor force experience for women. If this causes a change in the
proportion of women participating in labor markets and a change in the productivity of the
typical female worker (e.g., by changing how much education she has), then there can be a
significant impact on market measures like real GDP. The fewer women are working, and
the lower the productivity of the typical female worker, the lower real GNP will be. (In the
real world there may be a number of other effects, including some that don’t even become
apparent until later generations, e.g., effects on the productivity of children raised in child
care facilities.)
In this program you pick the value for the typical age for people to marry, and subsequent
economic changes do not cause this value to change. Be aware that in the real world
economic changes can be important causes for changing the typical age at marriage. This is
one of the ways in which this program oversimplifies reality.
Limit: You must set a reasonable age. It would be absurd to set a typical age for marriage
at 50 (for women, high tech methods aside, this would make having any children unusual.)
Setting a value of 10 would be irrelevant. (Some cultures “marry” children at -- sometimes
even before -- birth. However, even in such cases the marriage does not “take effect” till at
least puberty.) You cannot set the typical age at marriage lower than 14, and you can set it
no higher than 40.
Desired Number of Children
Another major social variable you set in this program is the number of children the average
person in the given society wants. Differences between societies on this point can arise
from religious or cultural values. Having more children per average family obviously
allows for more population growth. Having more children will, however, also reduce
participation by women in the labor force, and that affects market production -- and real
GDP.
As with the age for marriage, in the real world the number of children people want is not
some arbitrary number that never changes. As national economies change, the number of
children the average person wants also changes. (So may the relative importance of the
number of children men want, compared to the importance of the number of children
women want.) In this program, however, the number does not change unless you change it.
The actual number of children people have does change in this program, as other influences
affect choices -- they may wind up having (on average) a number different from the one
that they say they want (on average).
Limit: It would not be reasonable to set a typical value for the desired number of children
at 20. It is—barely--possible for a person to have that many children (easier for a man). It
is not really possible for that to be typical. Also, there are many people who do not want
any children, but it isn’t likely that the average person in any society will want much less
than two. You can set the average desired number of children no lower than 1.75, and no
higher than 10.
Economic Variables
One of the economic variables in this program is set at the beginning and is usually kept
constant over the generations. Others are set as a matter of policy, one generation at a time.
While these are all termed “economic variables” they reflect social values, which you
should consider when creating a society.
Research and Development
This variable is, by its nature, a long-term matter. In setting it, you determine how much
income is set aside by society to develop new and more productive technology. Research
and development uses resources that could be used to add to the stock of capital, i.e.
machinery, equipment, buildings, for future use in production. The same resources could
be used to produce public goods, improve education, or improve the standard of living for
the young.
Some of these other uses would add to the future prosperity of this society. The new
knowledge created by R & D also adds to society’s future ability to produce. Various types
of improvements in technology may be labor saving, while others are capital or natural
2
resource saving, but in this module all that matters is that successful R & D increases
society’s ability to produce with any given stock of resources, i.e. capital and labor.
Limits: There is a limit to the resources that can be devoted to research and development.
The more resources devoted to R & D, the fewer resources will be available for
constructing new capital equipment (to use with the new technology), educating workers, or
producing current consumption goods. The most you can devote to research and
development in this module is 20% (.20) of real GDP. The least you can devote to R & D
is zero.
Investment
Investment by a society consists of spending on things that will increase the future ability to
produce. This includes machinery, equipment, buildings, roads, bridges, etc. The larger
the proportion of current production devoted to this use, the larger the future ability to
produce -- the larger future real GDP.
The usefulness of investment is not constant, however. Investment adds to a society’s
stock of capital. If the stock of capital grows more rapidly than other resources (like labor),
then additional capital becomes subject to the Law of Diminishing Marginal Returns
(also known as the law of diminishing returns). That means further increases in investment
(even faster growth of capital) will cause smaller and smaller increases in production (real
GNP). At some point a society should say that more investment will not give enough
future production to make up for the sacrifices needed to make the investment. In other
words, as investment rises, the opportunity cost of investment eventually becomes larger
than the benefits of investment -- and isn’t worth doing any more.
Limit: You can’t spend more than you have. After allowing for the pensions you have set
up, there has to be enough left out of current real GNP to support your spending decisions.
(Don’t forget you still have to allocate something to public health and leave something for
consumption by current workers and their children.)
Public Goods
In this module the term “Public Goods” is used as a kind of shorthand to cover a multitude
of different types of spending. Building sewers, hospitals, hiring public health doctors and
nurses and everything that makes people live longer and be better workers—including
education. Spending on public goods is subject to the Law of Diminishing Marginal
Returns, just like investment.
Limit: You still can’t spend more than is available. You are limited by what is left out of
real GDP after your previous decisions on research and development and on investment.
Note: Savings are not noted independently in this module. However the user should be
aware that total income for the country (real GDP) minus investment spending, public
goods spending, and allocations for research and development equals the consumption of
this society. That also means that investment spending, public goods spending, and
allocations for research and development equals total savings of this society.
3
Consumption
You do not set the amount of consumption in this society, the amount of consumption is
what is left of real GDP after investment (which you set), public goods spending (which
you set) and research and development spending (which you set). If you set these things
too high you could wind up starving your population to death, which will set you back to
the beginning -- starting your country up again. The consumption measured in the module
could be done directly by households, or it could include what is sometimes called
“government consumption” which could be weapons systems, or pyramids, or providing
bread and circuses to the population to keep them from rebelling.
Running the Module
A major reason for running the program is to get an idea of how, and by how much, each
variable affects the results for your society. The best way of doing this is to run the
program a number of times, for at least three generations each time. (Three generations is
the minimum you need to be sure you have all the effects of a change showing up. Some
effects of a change may not appear at all for a generation after the change is put in place.)
The first time you run the program, do it using the “default” values of all the variables -without changing anything -- and record the results. (Default means the values you see in
the appropriate boxes when they first appear.) The second time you run the program
change the value of one variable, keeping all the others at their default values -- and record
the results. The third time change a different variable, with all the others at their default
values -- and record the results. If you do this for all the variables, you will run the
program six times. By comparing each of the last five results with the first set of results,
you can easily see what changing each variable accomplished.
You will find it useful to print the screens on which you put in the values of the variables,
and the screens showing the generation by generation results. It is not really enough to
print the graph on which real GDP per capita is recorded. Remember, real GDP per capita
is the most informative single number you can get -- but no single number tells everything
you need to know.
WARNING: If you run the program fewer times, and change several variables at once,
you will find it very difficult -- even impossible -- to figure out what effect changing one
variable had. This is very likely to cause confusion and spoil the whole point of using a
program like this.
If you have recorded all the necessary information, as mentioned above, you can easily see
what a given variable does in this program. However, you will still need to be able to
explain why it gives that result, even in the context of a mere computer problem. You will
also need to be able to explain the extent to which relationships in the program resemble
those in the real world.
4
Mathematical Model
The module begins with a fixed population, real GDP, and amount of capital. After that
results depend on user inputs for the three "Social" and two "Economic" variables.
Population growth:
The change in population (delpopulation), measured in millions of people, depends on the
previous population size (pop), on the proportion of real GDP devoted to consumption, on
the desired number of children, relative to the replacement value of 2 (numchildren), and
on the age at marriage (age).
population = population + population * ((-0.11 * (consumption / GDP))
+ 0.025 * (numchildren - 2) - (0.27 * ((age - 14) / 14)))
real GDP depends on the age at marriage, on the amount of capital available, on the level of
technology (techRate) and on the size of the population. Available capital is determined by
the initial value, plus all the investment the user has made up to the particular generation.
Real GDP =1.75 * techRate * ((age-13) / 14) * Capital0.3 * population0.7
TechRate is determined by the amount society spends (tech) on research and development.
For a given level of spending, the amount by which technology improves changes over the
generations. In generation 1:
techRate = (1 + (GDP * tech * .0025))
(This calculation is made using the previous period’s real GDP.)
Consumption is what is left of real GDP after the user-determined values for investment
and public goods spending.
consumption = GDP - investment - pubgoods
The per capita values for real GDP and consumption are, of course, determined by the
above calculations for real GDP and consumption and by the new population--the previous
population plus the change in population for this generation.
5