Ramsey in dual-population lands: internal conflict and utility-maximizing consumption
Ramsey's model is extended to three possible scenarios of conflicts in dual‐population lands: partition, federation and civil war. The federally utility‐maximizing consumption‐growth rate in a strictly political federation might be lower than that under partition for the wealthier and more slowly multiplying group. This group may benefit from joining a federation that facilitates technological transfer and from obeying the federal no‐arbitrage rule as long as its own technology is inferior to the hybrid. The utility‐maximizing consumption growth rate for a group engaged in a civil war is larger than those under partition and a strictly political federation if its rival's warfare is mainly aimed at inflicting casualties and is likely to be smaller when its rival's warfare is mainly sabotage.
This record is in the process of being updated. Please contact us for more information.