Time Delays and Business Cycles: Hilferding's model revisited
AbstractThis paper develops a Marxian model of the business cycle based on Hilferding's theory of disproportionality in capital accumulation in a two-sector economy. The disproportionality arises from the existence of time delays in production generated by the differential capital intensity in the two sectors. The time delays produce an asymmetric price structure that causes overproduction and crisis. The model is constructed using delay-differential equations. Numerical simulations show that the model produces an economy-wide business cycle phenomenon. The domain of the time delay parameter is investigated, and shows that the model produces a wide variety of dynamics from monotonic convergence to explosive oscillations. Moreover, the solution shows that intersectoral investment flows transmit the instability in capital accumulation and that longer time delays produce higher cycle amplitudes.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Taylor and Francis Journals in its journal Review of Political Economy.
Volume (Year): 13 (2001)
Issue (Month): 3 ()
Contact details of provider:
Web page: http://taylorandfrancis.metapress.com/link.asp?target=journal&id=102233
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Roger E. A. Farmer, 1999. "Macroeconomics of Self-fulfilling Prophecies, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262062038, June.
- Asea, Patrick K. & Zak, Paul J., 1999.
"Time-to-build and cycles,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 23(8), pages 1155-1175, August.
- Mackey, Michael C., 1989. "Commodity price fluctuations: Price dependent delays and nonlinearities as explanatory factors," Journal of Economic Theory, Elsevier, vol. 48(2), pages 497-509, August.
- Zarnowitz, Victor, 1992. "Business Cycles," National Bureau of Economic Research Books, University of Chicago Press, number 9780226978901, July.
- Darity, William A, Jr & Horn, Bobbie L, 1985. "Rudolf Hilferding: The Dominion of Capitalism and the Dominion of Gold," American Economic Review, American Economic Association, vol. 75(2), pages 363-68, May.
- Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
- Harris, Donald J, 1983. "Accumulation of Capital and the Rate of Profit in Marxian Theory," Cambridge Journal of Economics, Oxford University Press, vol. 7(3-4), pages 311-30, September.
- Long, John B, Jr & Plosser, Charles I, 1987. "Sectoral vs. Aggregate Shocks in the Business Cycle," American Economic Review, American Economic Association, vol. 77(2), pages 333-36, May.
- Eagly, Robert V, 1972. "A Macro Model of the Endogenous Business Cycle in Marxist Analysis," Journal of Political Economy, University of Chicago Press, vol. 80(3), pages 523-39, May-June.
- Gale, Douglas, 1996. "Delay and Cycles," Review of Economic Studies, Wiley Blackwell, vol. 63(2), pages 169-98, April.
- Joseph E. Stiglitz, 1993. "Methodological Issues and the New Keynesian Economics," NBER Working Papers 3580, National Bureau of Economic Research, Inc.
- Norrbin, Stefan C & Schlagenhauf, Don E, 1991. "The Importance of Sectoral and Aggregate Shocks in Business Cycles," Economic Inquiry, Western Economic Association International, vol. 29(2), pages 317-35, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.