Production saving model
∂L
∂kt
=λt 1 λtf^0 (kt) νtkt= 0.
If we exclude corner solutions thenνt=μt=0 and then
λt 1 = λtf^0 (kt)
λt = βtU^0 (ct)
∂kt
=λt 1 λtf^0 (kt) νtkt= 0.
If we exclude corner solutions thenνt=μt=0 and then
λt 1 = λtf^0 (kt)
λt = βtU^0 (ct)