A Brief Reminder on Steady-State

Abstract

This study is only a short reminder which emphasizes some important characteristics of steady-state. According to the study, since constant returns to scale conditions imply full capacity or full employment and it is compatible with steady-state, then, steady-state conditions indicate full capacity or full employment. Besides, since Harrod-neutral technological progress is compatible with steady-state conditions, then, Harrod-neutral technological progress guarantees full employment. The study proposes that; these characteristics of steady-state should not be neglected during economic analysis, in order to be consistent with the concepts of economics.

Keywords: Steady-state, constant returns to scale, full employment

JEL Classification: O40, 049