Examining the Effect of Population on Economic Growt Using Optimal Growth Theory An Application of Genetic Algorithm Iranian Economy (1350-1385)



In this paper, we have studied the effect of population on Iranian economic growth by using optimal growth theory. Optimal growth theory is a nonlinear dynamic planning. Classical approaches in mathematics are used for solving these nonlinear systems. But, in this study, we have used Genetic Algorithm (GA) method. As results show, it seems that population growth in previous years (1350- 1386), can describe an important part of growth rate for per capita capital and per capita output in Iranian economy. Annaual growth rate of 2.5% in Iran population during 1350-86, has increased per capita consumption, per capita income, per capita saving and per capita capital formation by 14%, 14%, 8% and 46% respectively. Results of the study also suggest that it is better to have a positive growth rate for Iranian future population rather than a zero rate, because with a growing population we will have a higher rate for capital formation and per capita output. Moreover, if policy makers could move the system to a more equated situation (inter-temporal equity) we could have the more positive effect of population growth on the level of economic activities. If population grows by 1%, per capita output and per capita capital formation will be growth 8.2% and 18 % respectively.
JEL classification: C61; C88; O47