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Continuous Hicksian trade cycle model with consumption and investment time delays

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  • Matsumoto, Akio
  • Szidarovszky, Ferenc

Abstract

The main purpose of this paper is to consider effects caused by time delays on stability of continuous models when the dynamic system is piecewise differentiable. To this end, we construct a continuous version of the discrete Hicksian trade cycle model and introduce continuously distributed time delays. It is demonstrated that time delays stabilize an otherwise unstable system, and a piecewisely connected limit cycle is generated around an unstable stationary state.

Suggested Citation

  • Matsumoto, Akio & Szidarovszky, Ferenc, 2010. "Continuous Hicksian trade cycle model with consumption and investment time delays," Journal of Economic Behavior & Organization, Elsevier, vol. 75(1), pages 95-114, July.
    • Handle: RePEc:eee:jeborg:v:75:y:2010:i:1:p:95-114
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    References listed on IDEAS

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    1. Hommes, Cars H., 1993. "Periodic, almost periodic and chaotic behaviour in Hicks' non-linear trade cycle model," Economics Letters, Elsevier, vol. 41(4), pages 391-397.
    2. W. W. Chang & D. J. Smyth, 1971. "The Existence and Persistence of Cycles in a Non-linear Model: Kaldor's 1940 Model Re-examined," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 38(1), pages 37-44.
    3. Puu, Tonu, 2007. "The Hicksian trade cycle with floor and ceiling dependent on capital stock," Journal of Economic Dynamics and Control, Elsevier, vol. 31(2), pages 575-592, February.
    4. Iryna Sushko & Tönu Puu & Laura Gardini, 2006. "A Goodwin-Type Model with Cubic Investment Function," Springer Books, in: Tönu Puu & Iryna Sushko (ed.), Business Cycle Dynamics, chapter 11, pages 299-316, Springer.
    5. Laura Gardini & Tönu Puu & Iryna Sushko, 2006. "The Hicksian Model with Investment Floor and Income Ceiling," Springer Books, in: Tönu Puu & Iryna Sushko (ed.), Business Cycle Dynamics, chapter 6, pages 179-191, Springer.
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    Cited by:

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    4. Matsumoto, Akio & Szidarovszky, Ferenc, 2015. "Nonlinear multiplier–accelerator model with investment and consumption delays," Structural Change and Economic Dynamics, Elsevier, vol. 33(C), pages 1-9.

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