The Direct Effect of the Occupational Training of Adults Program on Canadian Unemployment Rates

Abstract

Concavity of U(C1, C2) still holds, and the above presentation is valid with minor alterations. It is not surprising that the optimal level of G exceeds zero. It is interesting to note that if v(G) > 0 no non-trivial steady-state exists. In this case, presumably no waste disposal is optimal, because as waste accumulates marginal units become less objectionable. Two extensions of the basic model seem warranted. One should include population growth, perhaps even with an endogenous factor (such as health) affecting the growth rate. Another is to include capital as a state variable in the model although this becomes difficult. Controlled systems suffer from the basic flaw that once an economy gets off an optimal trajectory it tends to move away from that trajectory. Informational or policy lags are costly. With this in mind it generally seems advisable to incorporate as much of the conventional competitive pricing adjustment mechanisms into controlled systems as possible. The above fining system does this to some extent, but in fact the more popular auctioning process'0 of pollution rights may be even more efficient.