IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

A Chaotic Map Arising in the Theory of Endogenous Growth

  • Michele Boldrin
  • Nicola Perisco

Growth theorists have almost always adopted the assumption of balanced growth in their investigations of development phenomena. In reality countries growth rates oscillate, sometimes wildly, around some average value. The latter is often taken to represent the balanced rate to which the development dynamics spontaneously tends to return after each perturbation. In this paper we try a different interpretation: the growth rate of capital stock in a developing economy oscillates within some bounded interval of feasible values and the balanced growth is in fact unstable. These oscillations may be persistent and endogenously determined by the accumulation process itself and they generate a non-trivial, invariant distribution of growth rates. We study a class of two-sector models displaying this feature in the prescence of a positive external effect. The qualitative properties of a specific example are analyzed by means of analytical and numerical methods. Our simulations reveal that, while the artificial economy is certainly able to display rather impressive endogenous growth cycles, they occur only when the external effects is unreasonably strong. Similarly to previous tentatives of modeling endogenous oscillations by means a chaotic map, we suceed at the theoretical level but fail short of reproducing some crucial empirical properties of the growth cycles experienced by modern market economies.

If 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.

File URL:
File Function: main text
Download Restriction: no

Paper provided by Northwestern University, Center for Mathematical Studies in Economics and Management Science in its series Discussion Papers with number 1071.

in new window

Date of creation: Nov 1993
Date of revision:
Handle: RePEc:nwu:cmsems:1071
Contact details of provider: Postal: Center for Mathematical Studies in Economics and Management Science, Northwestern University, 580 Jacobs Center, 2001 Sheridan Road, Evanston, IL 60208-2014
Phone: 847/491-3527
Fax: 847/491-2530
Web page:

More information through EDIRC

Order Information: Email:

References listed on IDEAS
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.:

as in new window
  1. Brock, William A., 1975. "A simple perfect foresight monetary model," Journal of Monetary Economics, Elsevier, vol. 1(2), pages 133-150, April.
  2. Gary Hansen, 2010. "Indivisible Labor and the Business Cycle," Levine's Working Paper Archive 233, David K. Levine.
  3. Michele Boldrin & Aldo Rustichini, 2010. "Growth and Indeterminacy in Dynamic Models with Externalities," Levine's Working Paper Archive 1382, David K. Levine.
  4. Michele Boldrin, 1988. "Paths of Optimal Accumulation in Two-Sector Models," UCLA Economics Working Papers 464, UCLA Department of Economics.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:nwu:cmsems:1071. 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: (Fran Walker)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.