IDEAS home Printed from https://ideas.repec.org/a/eee/chsofr/v29y2006i3p681-696.html
   My bibliography  Save this article

On the change of periodicities in the Hicksian multiplier-accelerator model with a consumption floor

Author

Listed:
  • Puu, Tönu
  • Gardini, Laura
  • Sushko, Iryna

Abstract

The Hicksian multiplier-accelerator model with “floor” and “ceiling” continues to be the most successful machine generating business cycles. This is, no doubt, due to its capability of explaining both downturn and upswing through one single model. The “ceiling” is due to a full employment constraint, whereas the “floor” is due to a limit to disinvestment when no worn out capital at all is replaced. However, another “floor” to consumption at zero level seems never to have been discussed. Hence, net disinvestments, even if they are bounded downwards, may also give rise to negative consumption, which is absurd. As we will show, the effect of an additional constraint to avoid this is easy to analyze, and results in a change of the periodicities according to a simple rule.

Suggested Citation

  • Puu, Tönu & Gardini, Laura & Sushko, Iryna, 2006. "On the change of periodicities in the Hicksian multiplier-accelerator model with a consumption floor," Chaos, Solitons & Fractals, Elsevier, vol. 29(3), pages 681-696.
  • Handle: RePEc:eee:chsofr:v:29:y:2006:i:3:p:681-696
    DOI: 10.1016/j.chaos.2005.08.099
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960077905007460
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. James J. Duesenberry, 1950. "Hicks on the Trade Cycle," The Quarterly Journal of Economics, Oxford University Press, vol. 64(3), pages 464-476.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:chsofr:v:29:y:2006:i:3:p:681-696. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thayer, Thomas R.). General contact details of provider: https://www.journals.elsevier.com/chaos-solitons-and-fractals .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.