<p>In this example, &quot;mass&quot; means the same as &quot;length&quot;. Let me try to explain it with a simple example.</p>
<p>If you work in a continuous setting, you have an <em>infinite</em> number of agents, which lie on a line between <span class="math-container">$0$</span> and <span class="math-container">$M$</span>. Let's say individual consumption is given by the function <span class="math-container">$C(i)$</span>, for all agents <span class="math-container">$i \in [0,M]$</span>.</p>
<p>For total consumption, you have to integrate: <span class="math-container">$C = \int_0^M C(i)di$</span> (total consumption is the area under the graph). <span class="math-container">$M$</span> is the mass of all agents. In your example, <span class="math-container">$M$</span> is equal to 1.</p>
<p>This is not done for realism. Continuous agents are usually used when you want to introduce heterogeneity in a model. For instance, in the standard New Keynesian model (see, e.g., <em>Walsh, Monetary Theory and Policy, chapter 8</em>), households don't face one price, but <em><strong>a distribution of</strong></em> different prices, and hence also different demand.</p>

CC BY-SA 4.0
2021-10-28T10:02:10.367Z
I understand what you are trying to say, though I am trying to get my mind around how this relates to real life. Continuous setting with infinite number of agents is a bit mind boggling to me. Is it a correct interpretation that continuous agents in practice essentially means that a single agent has no say in the economy like perfect competition (since di is close to 0)? Is there anywhere I can learn more of models like this with continuous agents? Is there a term for models like these? I couldn't really find anything introductory on this.
Shaikh Ammar
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2021-10-29T11:48:25.280Z
@ShaikhAmmar I extended the answer to include your follow-up questions. You are right that single agents are  infinitely small in this setting.
Chris tie
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2021-10-27T17:21:40.550Z
2021-10-29T11:46:50.137Z
2021-10-29T11:46:50.137Z
Chris tie
<p>A Solow model problem I am trying to solve asks me to assume that the economy consists of identical agents of <strong>mass</strong> 1. I have never heard of this term before, what does this mean?</p>

<macroeconomics><definition><solow>
What does "mass" mean in a Macroeconomic model?
Shaikh Ammar
# What does "mass" mean in a Macroeconomic model?

(Asked by: username_0 on 2021-10-27)

A Solow model problem I am trying to solve asks me to assume that the economy consists of identical agents of **mass** 1. I have never heard of this term before, what does this mean?

**Tags:** macroeconomics, definition, solow


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## 1 answers

### Answer by username_1 on 2021-10-27. Score: 5 | Accepted answer

In this example, "mass" means the same as "length". Let me try to explain it with a simple example.

If you work in a continuous setting, you have an *infinite* number of agents, which lie on a line between $0$ and $M$. Let's say individual consumption is given by the function $C(i)$, for all agents $i \in [0,M]$.

For total consumption, you have to integrate: $C = \int\_0^M C(i)di$ (total consumption is the area under the graph). $M$ is the mass of all agents. In your example, $M$ is equal to 1.

This is not done for realism. Continuous agents are usually used when you want to introduce heterogeneity in a model. For instance, in the standard New Keynesian model (see, e.g., *Walsh, Monetary Theory and Policy, chapter 8*), households don't face one price, but ***a distribution of*** different prices, and hence also different demand.

> **Comments:**
> **username_0**: I understand what you are trying to say, though I am trying to get my mind around how this relates to real life. Continuous setting with infinite number of agents is a bit mind boggling to me. Is it a correct interpretation that continuous agents in practice essentially means that a single agent has no say in the economy like perfect competition (since di is close to 0)? Is there anywhere I can learn more of models like this with continuous agents? Is there a term for models like these? I couldn't really find anything introductory on this.  
> **username_1**: @username_0 I extended the answer to include your follow-up questions. You are right that single agents are  infinitely small in this setting.  

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