which holds in the case of balanced growth equilibrium. In this equation, c is consumption per capita; k is capital per worker, a is technological progress; 0 is index of externality, x is availability of complementary factors of productions, such as infrastructure or human capital: T is the tax rate; p z +n is the real interest rate; n is population growth; z is the rate of time preference; o is the inverse of the negative of the elasticity of marginal utility;. If the cost of capital p is high for any return on investment, investment is low and the economy is considered liquidity constrained. If the rate of return r is low, for any cost of capital, investment is low and the economy is considered inefficient