Neoclassical Macroeconomics 2.0

A lightweight economic overhaul based on neoclassical growth theory.

Features

Capital-Labor Ratio (capital intensity)

Diminishing returns to capital (approximated)

Scripted values for output, productivity, and efficiency

Balance Index (proxy for inflation)

Buffs tied to neoclassical growth logic

Gameplay Impact
Investment and construction scale more realistically with population, savings, and technology. Private sector behavior plays a stronger role in throughput and long-term growth.

Higher Investment → More Capital Accumulation → Higher Capital-Labor Ratio → Increased Productivity → Greater Output → Economic Growth

Capital-Labor Ratio (Capital Intensity)

The capital-labor ratio (k = K / L) measures the amount of capital (K) per worker (L). A higher ratio reflects greater capital intensity—more tools, machines, and infrastructure per person.

In this mod, capital accumulation is approximated through the behavior of the investment_pool. As this pool grows and is spent on constructing new buildings, it reflects increased capital stock. Over time, this simulates the accumulation process central to neoclassical growth models.

Balance Index (Inflation Proxy)

The mod includes a Balance Index that acts as a rough indicator of inflation. It tracks a representative basket of goods and compares the number of buy vs. sell orders.
If demand outpaces supply, the index rises—signaling inflationary pressure. If supply exceeds demand, it suggests deflation.
This helps approximate price dynamics without relying on hardcoded inflation mechanics.

"The hon. Gentleman is saying that he would rather that the poor were poorer, provided that the rich were less rich…
So long as the gap is smaller, they’d rather have the poor poorer. That is the Liberal policy."
– Margaret Thatcher

Compatibility

Compatible with most UI and economic mods

Load after major overhauls

MP compatible ✅

Coming Soon

Interest rate dynamics

More realistic consumption behavior

Expanded savings & credit mechanisms