Comparative dynamics in the one-sector optimal growth model

1983 ◽  
Vol 6 ◽  
pp. 99-107 ◽  
Author(s):  
Robert A. Becker
Author(s):  
Wei-Bin Zhang

The paper introduces applications of chaos theory in economics. By studying some economic models which exhibit chaotic behavior both in discrete and continuous times and in different dimensions, this paper demonstrates wide applications of chaos theory in different schools of economics. In particular, the paper argues that chaos theory is a basic tool for integrating various economic theories within a new dynamic theory. The paper first introduces the topic and gives a basic survey of the early literature. Then it examines chaotic behavior of some economic models. Application 1 introduces the logistic map and examines the one-dimensional discrete growth model with population by Haavelmo and Stutzer. Application 2 identifies economic chaos in the disequilibrium inventory model by Hommes. Application 3 studies a long-run competitive two-periodic OLG model with money and capital. Application 4 discusses the Lorenz equations and its application to urban dynamics. Application 5 introduces the traditional optimal growth model with multiple capital goods, demonstrating the existence of periodic and aperiodic solutions. Finally we conclude the study and discuss some implications of chaos theory for creating a general economic theory.


Econometrica ◽  
1972 ◽  
Vol 40 (6) ◽  
pp. 1137 ◽  
Author(s):  
Mohamed A. El-Hodiri ◽  
Edna Loehman ◽  
Andrew Whinston

1996 ◽  
Vol 63 (2) ◽  
pp. 418 ◽  
Author(s):  
Kenneth A. Lewis ◽  
Laurence S. Seidman
Keyword(s):  

2016 ◽  
Vol 811 ◽  
Author(s):  
Bruce R. Sutherland ◽  
C. P. Caulfield

The cylindrical lock-release laboratory experiments of Sutherland & Nault (J. Fluid Mech., vol. 586, 2007, pp. 109–118) showed that a radially advancing symmetric intrusive gravity current spreads not as an expanding annulus (as is the case for bottom-propagating gravity currents), but rather predominantly along azimuthally periodic radial ‘spokes’. Here, we investigate whether the spokes are associated with azimuthal perturbations that undergo ‘optimal’ growth. We use a nonlinear axisymmetric numerical simulation initialised with the experimental parameters to compute the time-evolving axisymmetric base state of the collapsing lock fluid. Using fields from this rapidly evolving base state together with the linearised perturbation equations and their adjoint, the ‘direct–adjoint looping’ method is employed to identify, as a function of the azimuthal wavenumber $m$, the vertical–radial structure of the set of initial perturbations that exhibit the largest total perturbation energy gain over a target time $T$. Of this set of perturbations, the one that extracts energy fastest, and so is expected to be observed to emerge first from the base flow, has azimuthal wavenumber comparable to the number of spokes observed in the experiment.


1998 ◽  
Vol 3 (4) ◽  
pp. 425-442 ◽  
Author(s):  
LUCAS BRETSCHGER

This paper presents different substitution mechanisms which determine, in a theoretical framework, the conditions for long-term sustainable development. In a one-sector approach and in two versions of a multi-sector endogenous growth model, the accumulation and the substitution of man-made inputs for natural resources are analysed. Assuming man-made capital to be an output of a specific sector of the economy, the elasticities of substitution between the different inputs play a more complex role than suggested by the one-sector approach. According to the multi-sector models, the prediction of growth becoming sustainable emerges as realistic, provided that the sectoral adjustment costs in the economy are not too high.


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