Capital Destruction, Optimal Defense and Economic Growth

Borradores de Economia
Número: 
257
Publicado: 
Clasificación JEL: 
D23, D74, E21, O41
Palabras clave: 
capital accumulation, deterrence, capital destruction and economic growth.

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The effects of capital destruction are endogenized in a neoclassical growth model where the economy can optimally allocate part of its labor force to defend capital from being destroyed. The purpose is to explain the optimal allocation of the labor force