Some Properties of R. G. D. Allen's Treatment of Kalecki's 1935 Model of Business Cycles

2002 ◽  
Vol 24 (4) ◽  
pp. 463-474
Author(s):  
John V. Baxley ◽  
John C. Moorhouse
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Mathematical Models ◽  
Closed Form ◽  
Analytic Solution ◽  
John Maynard Keynes

More than sixty-five years have passed since Michal Kalecki (1935) published one of the first formal mathematical models of business cycles. His paper presents a closed-form analytic solution. This characteristic, among others, sets Kalecki's work apart from that of contemporary literary business cycle theorists such as Friedrich A. Hayek (1935) and John Maynard Keynes (1936).

EXPANSIONS AND RECESSIONS IN THE MEXICAN STATES: A CLASSICAL BUSINESS CYCLES APPROACH

2017 ◽  
Vol 3 (5) ◽  
pp. 32
Author(s):  
Pablo Mejía-Reyes
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Monthly Basis ◽  
Production Index ◽  
Clear Cut ◽  
Output Measure ◽  
Central Regions ◽  
The Business Cycle ◽  
National Business ◽  
Cycle Indicator

This paper aims to document expansions and recessions characteristics for 17 states of Mexico over the period 1993-2006 by using a classical business cycle approach. We use the manufacturing production index for each state as the business cycle indicator since it is the only output measure available on a monthly basis. According to this approach, we analyse asymmetries in mean, volatility and duration as well as synchronisation over the business cycle regimes (expansions and recessions) for each case. Our results indicate that recessions are less persistent and more volatile (in general) than expansions in most Mexican states; yet, there is no clear cut evidence on mean asymmetries. In turn, there seems to be strong links between the business cycle regimes within the Northern and Central regions of the country and between states with similar industrialisation patterns, although it is difficult to claim that a national business cycle exists.

scholarly journals News-Driven Business Cycles: Insights and Challenges

2014 ◽  
Vol 52 (4) ◽  
pp. 993-1074 ◽  
Author(s):  
Paul Beaudry ◽  
Franck Portier
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Empirical Evidence ◽  
Economic Fluctuations ◽  
Aggregate Fluctuations ◽  
Business Cycle Fluctuations ◽  
Widespread Belief ◽  
Way Of Thinking ◽  
The Many

There is a widespread belief that changes in expectations may be an important independent driver of economic fluctuations. The news view of business cycles offers a formalization of this perspective. In this paper we discuss mechanisms by which changes in agents' information, due to the arrival of news, can cause business cycle fluctuations driven by expectational change, and we review the empirical evidence aimed at evaluating their relevance. In particular, we highlight how the literature on news and business cycles offers a coherent way of thinking about aggregate fluctuations, while at the same time we emphasize the many challenges that must be addressed before a proper assessment of the role of news in business cycles can be established. (JEL D83, D84, E13, E32, O33)

scholarly journals ECONOMIES OF SCALE IN BANKING, CONFIDENCE SHOCKS, AND BUSINESS CYCLES

2013 ◽  
Vol 18 (5) ◽  
pp. 1069-1090 ◽  
Author(s):  
Scott J. Dressler ◽  
Erasmus K. Kersting
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Economies Of Scale ◽  
Financial Intermediation ◽  
Monetary Shocks ◽  
Nominal Rigidities ◽  
Equilibrium Indeterminacy ◽  
Economic Volatility ◽  
Over Time

Equilibrium indeterminacy due to economies of scale (ES) in financial intermediation is quantitatively examined in a monetary business-cycle environment. Financial intermediation provides deposits that serve as a substitute for currency to purchase consumption, and depositing decisions are susceptible to nonfundamental shocks to confidence. The analysis considers various assumptions on nominal rigidities and the timing of deposit decisions. The results suggest that indeterminacy arises for small ES, and the resulting confidence shocks qualitatively mimic monetary shocks. A calibration exercise concludes that U.S. economic volatility from this nonfundamental source has increased over time while volatility from fundamental sources has decreased.

REAL BUSINESS CYCLES AFTER THREE DECADES

2013 ◽  
Vol 19 (2) ◽  
pp. 425-445
Author(s):  
Sumru Altug ◽  
Warren Young
Keyword(s):  
Social Sciences ◽  
Business Cycles ◽  
Business Cycle ◽  
Panel Discussion ◽  
Real Business Cycle ◽  
Real Business Cycles ◽  
Macroeconomic Analysis ◽  
Time To Build ◽  
History Of ◽  
Recent Financial Crisis

The transcript of a panel discussion marking three decades of the real business cycle approach to macroeconomic analysis as manifested in Kydland and Prescott's “Time to Build” (Econometrica, 1982) and Long and Plosser's “Real Business Cycles” (Journal of Political Economy, 1983). The panel consists of Edward Prescott, Finn Kydland, Charles Plosser, John Long, Thomas Cooley, and Gary Hansen. The discussion is moderated by Sumru Altug and Warren Young. The panel touches on a wide variety of issues related to real business cycle models, including their history and methodology, starting with the work of Prescott and Kydland at Carnegie Tech and Plosser and Long at Rochester; their applications to policy; and their role in the recent financial crisis and likely future.The panel discussion was held in a session sponsored by the History of Economics Society at the Allied Social Sciences Association (ASSA) meetings in the Randle A Room of the Manchester Grand Hyatt Hotel in San Diego, California.

scholarly journals Business Cycles in Algerian Economy: A Bayesian DSGE Approach

2018 ◽  
Vol 2 (1) ◽  
pp. 72-100
Author(s):  
Abdelsalam BOUKHEROUFA
Keyword(s):  
Time Series ◽  
Business Cycles ◽  
Business Cycle ◽  
Equilibrium Model ◽  
Government Spending ◽  
Aggregate Demand ◽  
Dynamic Stochastic General Equilibrium ◽  
Business Cycle Fluctuations ◽  
Output Fluctuations ◽  
Dynamic Stochastic

The main objective of this paper is to highlight the most important shocks that drives the business cycles in the Algerian economy. Using Bayesian estimation techniques, we estimate a dynamic stochastic general equilibrium model (DSGE) using four time series of the Algerian macroeconomics. Through this estimated model, which succeeded in capturing the dynamics of the Algerian economy data, we found three main results: First, the main causes of business cycle fluctuations in the Algerian economy are aggregate demand shocks. Second, the of government spending shock play the most important role in output fluctuations. Third, empirical results show evidences of procyclical in government spending policies.

scholarly journals Business cycle synchronization of a small open EU-candidate country’s economy with the EU economy

2018 ◽  
Vol 65 (5) ◽  
pp. 609-631 ◽  
Author(s):  
Vladimir Filipovski ◽  
Predrag Trpeski ◽  
Jane Bogoev
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Candidate Country ◽  
Economic Policies ◽  
Large Magnitude ◽  
Euro Zone ◽  
The Republic ◽  
High Degree ◽  
The Impact ◽  
The Eu

The objectives of this paper are to empirically identify business cycles in a small open EU-candidate country such as the Republic of Macedonia and to assess the degree of synchronization of the country?s business cycle with the cycle of the EU economy. Towards the first objective, we apply linear and non-linear methods for delineating the production gap cycle in the Macedonian economy. As for the second objective, we apply autoregressive methods to assess the size and speed of cyclical adjustment of the Macedonian economy to output shocks to the Euro-zone economy. The results of our analysis suggest a high degree of synchronization of the Macedonian business cycles with the cycles of the EU economy. Also, the shocks in economic activity in the Euro-zone economy are transmitted almost instantaneously, and with a large magnitude, to the Macedonian economy. Finally, the impact of the Euro-zone output contraction is less pronounced than the impact of the Euro-zone output expansion, suggesting an impact of the country?s autonomous countercyclical economic policies.

An investment model with entry and exit decisions

2000 ◽  
Vol 37 (2) ◽  
pp. 547-559 ◽  
Author(s):  
J. Kate Duckworth ◽  
Mihail Zervos
Keyword(s):  
Dynamic Programming ◽  
Closed Form ◽  
Production Scheduling ◽  
Analytic Solution ◽  
Investment Model ◽  
Programming Approach ◽  
Entry And Exit ◽  
Dynamic Programming Approach ◽  
Exit Decisions ◽  
Parameter Values

We consider an investment model which generalizes a number of models that have been studied in the literature. The model involves entry and exit decisions as well as decisions relating to production scheduling. We then address the problem of its valuation from the standpoint of the dynamic programming approach. Our analysis results in a closed form analytic solution that can take qualitatively different forms depending on parameter values.

scholarly journals Quantum Calcium-Ion Interactions with EEG

Sci ◽  
2018 ◽  
Vol 1 (1) ◽  
pp. 7 ◽  
Author(s):  
Lester Ingber
Keyword(s):  
Closed Form ◽  
Path Integral ◽  
Stochastic Systems ◽  
Analytic Solution ◽  
Short Term Memory ◽  
Mathematical Physics ◽  
Modest Improvement ◽  
Classical Physics ◽  
Arbitrary Time ◽  
Eeg Data

Background: Previous papers have developed a statistical mechanics of neocortical interactions (SMNI) fit to short-term memory and EEG data. Adaptive Simulated Annealing (ASA) has been developed to perform fits to such nonlinear stochastic systems. An N-dimensional path-integral algorithm for quantum systems, qPATHINT, has been developed from classical PATHINT. Both fold short-time propagators (distributions or wave functions) over long times. Previous papers applied qPATHINT to two systems, in neocortical interactions and financial options. Objective: In this paper the quantum path-integral for Calcium ions is used to derive a closed-form analytic solution at arbitrary time that is used to calculate interactions with classical-physics SMNI interactions among scales. Using fits of this SMNI model to EEG data, including these effects, will help determine if this is a reasonable approach. Method: Methods of mathematical-physics for optimization and for path integrals in classical and quantum spaces are used for this project. Studies using supercomputer resources tested various dimensions for their scaling limits. In this paper the quantum path-integral is used to derive a closed-form analytic solution at arbitrary time that is used to calculate interactions with classical-physics SMNI interactions among scales. Results: The mathematical-physics and computer parts of the study are successful, in that there is modest improvement of cost/objective functions used to fit EEG data using these models. Conclusions: This project points to directions for more detailed calculations using more EEG data and qPATHINT at each time slice to propagate quantum calcium waves, synchronized with PATHINT propagation of classical SMNI.

scholarly journals BUSINESS CYCLE – GROWTH NEXUS: A REVIEW

2015 ◽  
Vol 21 (3) ◽  
pp. 519-538
Author(s):  
Marinko ŠKARE ◽  
Daniel TOMIĆ
Keyword(s):  
Economic Growth ◽  
Business Cycles ◽  
Business Cycle ◽  
Economic Policies ◽  
Empirical Testing ◽  
Long Run ◽  
Cycle Growth ◽  
Complex Process ◽  
Theoretical Reasoning

Frequent reversals in business cycles pose the question whether country can achieve macroeconomic stability and/or economic growth by coordinating its economic policies. Thus, what is the role of economic policy within the short/long run in amplifying or dampening shocks? Business cycle – economic growth relationship is rather ambiguous and has, thus, attracted controversy. In this sense the (dis)belief that there indeed exists a relationship between the economic growth and business cycle, and their long-run convergence brings us to three important hypotheses that: (1) the evaluation of cycle-growth bond is inconclusive, (2) empirical testing of cycle synchronization is exaggerated and (3) the hypothesis of coupling/decoupling is ambiguous and can be misleading. Economic growth is a complex process and cannot be attributed to a single factor of observance hence this essay is just a tool of theoretical reasoning with firm grip on empirical circumstances that lead us to consider some issues that dwell the “growth economists” these days. Our study suggests a conclusion that discussions on the cycle-growth nexus are far from over, revealing us some remarkable confrontations within empirical domain.

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