Abstract

Households of contemporary economies  are characterized by many assets such as  gold, silver, diamond, land, housing, physical  wealth, in their portfolios. Yet modern  dynamic economic theory has only a few  mathematical models with physical wealth,  land and gold based on microeconomic  foundation. This study deals with portfolio  choice equilibrium with land, gold and  physical capital, and human capital within  a general equilibrium framework. The  growth determinants are endogenous  physical and human wealth accumulation.  The model studies dynamic interactions  between land value, gold value, economic  structural change, wealth accumulation and  human capital growth by integrating the  neoclassical growth theory, the Ricardian  theory, and the Uzawa-Lucas model with  Zhang’s utility function. The human capital  accumulation is due to Arrow’s learning by  doing, Uzawa’s learning through education,  and Zhang’s learning through consuming  (leisure creativity). We simulate the motion  of the economic system and demonstrate  the existence of a unique stable equilibrium  point. Comparative dynamic analysis  is conducted with regard to exogenous  changes in the propensity to consume gold, the propensity to receive education,  the propensity to consume housing, the  propensity to save, and the population.