Simulation

Click the run simulation button and you will see the values mapped out in the simulation panel as you did in the preceding models. I have based the following descriptions on the default value for the growth rate %: 0.25. You can run additional simulations within the range of -0.2% to 0.6%.

Savings, Production & Consumption

Under the savings, production & consumption tab you'll see the following results for the three variables plotted:

Consumption Rate

Over the period of the simulation the consumption rate rises at an ever slower rate as time progresses.

Production Rate

You will see a somewhat similar pattern with the production rate, which rises at an ever slowing rate. it actually declines slightly during the last few years.

Savings

Savings, in economic units, will accumulate in an ever slower rate for about 42 years. It then decreases for the last few years.

Fractional Consumption Rate

The chart on the fractional consumption rate shows how the fractional consumption rates increase from 0.9 to about 1.01 over that period of the simulation, as described in the introduction.

Consumption Rate of Growth

You will notice that, after the initial calculation correction, the growth of consumption steadily declines over the duration of the simulation. This indicates that increasing fractional rates of consumption actually lead to declining increases in the consumption rate, i.e. a leveling or declining standard of living.

This chart shows a small calculation anomaly because the consumption growth rates are calculated from preceding periods. Since the model has no growth rate to begin with, it must make its first years calculation based on a zero starting point. I have chosen not to complicate the model to correct for this anomaly at this time.

Conclusion

This model clearly shows how increasing fractional rates of consumption leads to slowing growth of the consumption rate and ultimately a decline in the consumption rate (or a slowing in the growth of economic activity.)

Any influence that increases the consumption rate in the short-run will, in the long-run, actually reduce the consumption rate.

Using the models that you have examined to this point as a base, we will, in the next few models, examine the result of intervention in this economic system.