Richard M. Goodwin
- Published in print:
- 1990
- Published Online:
- November 2003
- ISBN:
- 9780198283355
- eISBN:
- 9780191596315
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198283350.001.0001
- Subject:
- Economics and Finance, Macro- and Monetary Economics
This collection of short essays provides an application of chaotic dynamics to economic systems. Each chapter presents several economic models incorporating differential (or difference) equations ...
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This collection of short essays provides an application of chaotic dynamics to economic systems. Each chapter presents several economic models incorporating differential (or difference) equations such as the Rössler equations, which exhibit a chaotic attractor. Combining the insights of Schumpeter, Marx, and Keynes, the models endogenously generate irregular, wavelike growth. Goodwin therefore argues that the apparent unpredictability of economic systems is due to deterministic chaos as much as to exogeneous shocks. The book is aimed primarily at economists interested in theories of economic growth. However, readers with a general interest in the application of chaos theory to social sciences will also find it useful. Some mathematical knowledge of systems of differential equations is assumed.Less
This collection of short essays provides an application of chaotic dynamics to economic systems. Each chapter presents several economic models incorporating differential (or difference) equations such as the Rössler equations, which exhibit a chaotic attractor. Combining the insights of Schumpeter, Marx, and Keynes, the models endogenously generate irregular, wavelike growth. Goodwin therefore argues that the apparent unpredictability of economic systems is due to deterministic chaos as much as to exogeneous shocks. The book is aimed primarily at economists interested in theories of economic growth. However, readers with a general interest in the application of chaos theory to social sciences will also find it useful. Some mathematical knowledge of systems of differential equations is assumed.
Richard M. Goodwin
- Published in print:
- 1990
- Published Online:
- November 2003
- ISBN:
- 9780198283355
- eISBN:
- 9780191596315
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198283350.003.0003
- Subject:
- Economics and Finance, Macro- and Monetary Economics
Teases out parallels in the thinking of von Neumann and Marx. Goodwin presents a simplified version of the von Neumann model removing the assumption of infinite labour supply. The resulting ...
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Teases out parallels in the thinking of von Neumann and Marx. Goodwin presents a simplified version of the von Neumann model removing the assumption of infinite labour supply. The resulting non‐linear difference system shows endogenously erratic behaviour with cyclical output growth. In the long run, this system ceases to oscillate and another model is proposed to circumvent this problem. For low parameter values, the model has a fixed point; for moderate values, it has a limit cycle; and for higher values, a chaotic attractor is observed.Less
Teases out parallels in the thinking of von Neumann and Marx. Goodwin presents a simplified version of the von Neumann model removing the assumption of infinite labour supply. The resulting non‐linear difference system shows endogenously erratic behaviour with cyclical output growth. In the long run, this system ceases to oscillate and another model is proposed to circumvent this problem. For low parameter values, the model has a fixed point; for moderate values, it has a limit cycle; and for higher values, a chaotic attractor is observed.
Richard M. Goodwin
- Published in print:
- 1990
- Published Online:
- November 2003
- ISBN:
- 9780198283355
- eISBN:
- 9780191596315
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198283350.003.0002
- Subject:
- Economics and Finance, Macro- and Monetary Economics
Deals with the classical dynamical problem of technological advances in an agricultural (corn) economy. Goodwin asserts that two mis‐specifications—concerning labour supply and technical ...
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Deals with the classical dynamical problem of technological advances in an agricultural (corn) economy. Goodwin asserts that two mis‐specifications—concerning labour supply and technical progress—hampered classical models. A discrete time model is proposed with corn production embedded in a wider economy. The model has a chaotic attractor, and highly erratic market dynamics follow even in the absence of exogenous shocks.Less
Deals with the classical dynamical problem of technological advances in an agricultural (corn) economy. Goodwin asserts that two mis‐specifications—concerning labour supply and technical progress—hampered classical models. A discrete time model is proposed with corn production embedded in a wider economy. The model has a chaotic attractor, and highly erratic market dynamics follow even in the absence of exogenous shocks.
Richard M. Goodwin
- Published in print:
- 1990
- Published Online:
- November 2003
- ISBN:
- 9780198283355
- eISBN:
- 9780191596315
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198283350.003.0001
- Subject:
- Economics and Finance, Macro- and Monetary Economics
As in meteorology, prediction in economics is hampered by highly irregular, chaotic dynamics. A two‐sector model is employed to examine the complementary growth theories of Schumpeter and Keynes ...
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As in meteorology, prediction in economics is hampered by highly irregular, chaotic dynamics. A two‐sector model is employed to examine the complementary growth theories of Schumpeter and Keynes showing that innovation can lead to a decline in output. A brief history of the chaos theory follows noting that linear systems subject to shocks can appear chaotic. Finally, a further model demonstrates that innovation may stimulate a boom and subsequent collapse in output.Less
As in meteorology, prediction in economics is hampered by highly irregular, chaotic dynamics. A two‐sector model is employed to examine the complementary growth theories of Schumpeter and Keynes showing that innovation can lead to a decline in output. A brief history of the chaos theory follows noting that linear systems subject to shocks can appear chaotic. Finally, a further model demonstrates that innovation may stimulate a boom and subsequent collapse in output.
