Profit-driven and demand-driven investment growth and fluctuations in different accumulation regimes
AbstractThe main task of this work is to develope a model able to encompass, at the same time, Keynesian, demand-driven, and Marxian, profit-driven determinants of fluctuations. Our starting point is the Goodwin's model (1967), rephrased in discrete time and extended by means of a coupled dynamics structure. The model entails the combined interaction of a demand effect, which resembles a rudimentary first approximation to an accelerator, and of a hysteresis effect in wage formation in turn affecting investments. Our model yields ``business cycle movements either by means of persistent harmonic oscillations, or chaotic motions. These two different dynamical paths accounting for the behaviour of the system are influenced by its (predominantly) profit-led or wage-led structures.
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Bibliographic InfoPaper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2013/24.
Date of creation: 12 2013
Date of revision:
Endogenous Growth; Business Cycles; Investment; Aggregate Demand; Complex Systems; Nonlinear Dynamics; Chaos Theory;
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- Giovanni Dosi & Giorgio Fagiolo & Andrea Roventini, 2008.
"Schumpeter Meeting Keynes: A Policy-Friendly Model of Endogenous Growth and Business Cycles,"
50/2008, University of Verona, Department of Economics.
- Dosi, Giovanni & Fagiolo, Giorgio & Roventini, Andrea, 2010. "Schumpeter meeting Keynes: A policy-friendly model of endogenous growth and business cycles," Journal of Economic Dynamics and Control, Elsevier, Elsevier, vol. 34(9), pages 1748-1767, September.
- Giovanni Dosi & Giorgio Fagiolo & Andrea Roventini, 2008. "Schumpeter Meeting Keynes: A Policy-Friendly Model of Endogenous Growth and Business Cycles," LEM Papers Series, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy 2008/21, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
- Louca, Francisco, 2001. "Intriguing Pendula: Founding Metaphors in the Analysis of Economic Fluctuations," Cambridge Journal of Economics, Oxford University Press, Oxford University Press, vol. 25(1), pages 25-55, January.
- Yoshida, Hiroyuki & Asada, Toichiro, 2007. "Dynamic analysis of policy lag in a Keynes-Goodwin model: Stability, instability, cycles and chaos," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 62(3), pages 441-469, March.
- Fanti, Luciano & Gori, Luca & Sodini, Mauro, 2012. "Nonlinear dynamics in a Cournot duopoly with relative profit delegation," MPRA Paper 37834, University Library of Munich, Germany.
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