Introduction to Modern Economic Growth output (δ+n)k(t) f(k(t)) f(k*) consumption sf(k(t)) sf(k*) investment k* k(t) Figure 2.8 Investment and consumption in the state-state equilibrium with population growth Proposition 2.7 Consider the basic Solow growth model in continuous time and suppose that Assumptions and hold Then there exists a unique steady state equilibrium where the capital-labor ratio is equal to k∗ ∈ (0, ∞) and is given by (2.33), per capita output is given by y ∗ = f (k∗ ) and per capita consumption is given by c∗ = (1 − s) f (k∗ ) Moreover, again defining f (k) = af˜ (k) , we have (proof omitted): 70