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On the theory of firm in nonlinear dynamic financial and economic systems

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  • Dimitri O. Ledenyov
  • Viktor O. Ledenyov

Abstract

The new business paradigms originate a strong necessity to re-think the theory of the firm with the aim to get a better understanding on the organizational and functional principles of the firm, operating in the investment economies in the prosperous societies. In this connection, we make the innovative research to advance our scientific knowledge on the theory of firm in the conditions of the nonlinear dynamic financial and economic systems. We propose that the nonlinearities have to be taken to the consideration and the nonlinear differential equation have to be used to model the firm in the modern theories of the firm in the nonlinear dynamic financial and economic systems. We apply the econophysical approach with the dynamic regimes modeling on the bifurcation diagram as in the dynamic chaos theory with the purpose to accurately characterize the nonlinearities in the economic theory of the firm. We introduce the Ledenyov firm stability theorem, based on the Lyapunov stability criteria, to precisely characterize the stability of the firm in the nonlinear dynamic financial and economic systems in the time of globalization.

Suggested Citation

  • Dimitri O. Ledenyov & Viktor O. Ledenyov, 2013. "On the theory of firm in nonlinear dynamic financial and economic systems," Papers 1302.6721, arXiv.org, revised Mar 2013.
  • Handle: RePEc:arx:papers:1302.6721
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    File URL: http://arxiv.org/pdf/1302.6721
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    References listed on IDEAS

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    1. Hart, Oliver & Moore, John, 1990. "Property Rights and the Nature of the Firm," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1119-1158, December.
    2. Dimitri O. Ledenyov & Viktor O. Ledenyov, 2012. "On the Risk Management with Application of Econophysics Analysis in Central Banks and Financial Institutions," Papers 1211.4108, arXiv.org.
    3. Dimitri O. Ledenyov & Viktor O. Ledenyov, 2013. "On the optimal allocation of assets in investment portfolio with application of modern portfolio and nonlinear dynamic chaos theories in investment, commercial and central banks," Papers 1301.4881, arXiv.org, revised Feb 2013.
    4. Williamson, Oliver, 2009. "The Theory of the Firm as Governance Structure: From Choice to Contract," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 6, pages 111-134, December.
    5. Oliver Hart, 2011. "Thinking about the Firm: A Review of Daniel Spulber's The Theory of the Firm," Journal of Economic Literature, American Economic Association, vol. 49(1), pages 101-113, March.
    6. Dimitri O. Ledenyov & Viktor O. Ledenyov, 2012. "On the new central bank strategy toward monetary and financial instabilities management in finances: Econophysical analysis of nonlinear dynamical financial systems," Papers 1211.1897, arXiv.org.
    7. Viktor O. Ledenyov & Dimitri O. Ledenyov, 2012. "Shaping the international financial system in century of globalization," Papers 1206.2022, arXiv.org.
    8. Viktor O. Ledenyov & Dimitri O. Ledenyov, 2012. "Designing the new architecture of international financial system in era of great changes by globalization," Papers 1206.2778, arXiv.org.
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    Cited by:

    1. Dimitri O. Ledenyov & Viktor O. Ledenyov, 2013. "To the problem of turbulence in quantitative easing transmission channels and transactions network channels at quantitative easing policy implementation by central banks," Papers 1305.5656, arXiv.org, revised May 2013.
    2. Dimitri O. Ledenyov & Viktor O. Ledenyov, 2013. "On the accurate characterization of business cycles in nonlinear dynamic financial and economic systems," Papers 1304.4807, arXiv.org.
    3. Ledenyov, Dimitri O. & Ledenyov, Viktor O., 2013. "On the Stratonovich – Kalman - Bucy filtering algorithm application for accurate characterization of financial time series with use of state-space model by central banks," MPRA Paper 50235, University Library of Munich, Germany.
    4. Ledenyov, Dimitri O. & Ledenyov, Viktor O., 2013. "Some thoughts on accurate characterization of stock market indexes trends in conditions of nonlinear capital flows during electronic trading at stock exchanges in global capital markets," MPRA Paper 49921, University Library of Munich, Germany.
    5. Ledenyov, Dimitri O. & Ledenyov, Viktor O., 2015. "Wave function method to forecast foreign currencies exchange rates at ultra high frequency electronic trading in foreign currencies exchange markets," MPRA Paper 67470, University Library of Munich, Germany.

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