Capital Saving Towards Achievement of Inter-Temporal Sustainable Development

Since the time immemorial, saving has been considered as a major driving factor for the prosperity of household and the development of countries. Traditionally, the inter-temporal concept of saving is limited to one’s life span irrespective of next generation. Development is, however, not considered as sustainable unless it has inter-generational and societal stand. This paper intends to show how capital saving is crucial factor for sustainable economic development. Thus the paper develops capital saving model in which the saved capital transferred throughout generation. The model derived from ‘Infinite-Horizon Model’ developed by Ramsey-Cass–Koopmans. The derived model infers that the pressure of population growth in a geometric progression can be minimized through inter-generational capital saving. The model shows the simultaneous proportional growth of capital and population for continuous generation.