Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
This paper considers the neglected case of a capital-intensive investment-good sector in the two-sector Robinson-Shinkai-Leontief (RSL) model of discrete-time optimal economic growth. We find the optimal policy to be surprisingly simple and uniform between the discounted and undiscounted cases. The “straight-down-the-turnpike” policy, first identified by Winter and Shell, entails unemployment or excess supply of capital throughout the optimal transition dynamics. We extend our analysis to the case of circulating capital and find the optimal policy to have the same property. We also briefly indicate possibilities for application to topical concerns.