IDEAS home Printed from https://ideas.repec.org/p/pcp/pucwps/wp00344.html
   My bibliography  Save this paper

Is-Lm Stability Revisited: Samuelson Was Right, Modigliani Was Wrong

Author

Listed:
  • Waldo Mendoza Bellido

    (Departamento de Economía - Pontificia Universidad Católica del Perú)

Abstract

En el modelo IS-LM de Hicks, cuando la propensión marginal a gastar es mayor que uno, el multiplicador keynesiano es negativo y la IS tiene pendiente negativa. Keynes declaró este caso como completamente inestable. La literatura posterior, desde Modigliani (1944) hasta nuestros días, incluyendo a Varian (1977) y Sargent (1987), determinó que en este caso especial el modelo IS-LM es estable cuando la pendiente de la LM es mayor que la de la IS. En línea con Samuelson (1941), este artículo muestra que en este caso especial el modelo es estable cuando la pendiente de la IS es mayor que la de la LM. Sin embargo, en este caso estable, el modelo no tiene un significado económico útil. Primero, los valores de equilibrio de la producción y la tasa de interés son negativos. Segundo, dado que el multiplicador keynesiano es negativo, una expansión de la demanda reduce la producción.

Suggested Citation

  • Waldo Mendoza Bellido, 2012. "Is-Lm Stability Revisited: Samuelson Was Right, Modigliani Was Wrong," Documentos de Trabajo / Working Papers 2012-344, Departamento de Economía - Pontificia Universidad Católica del Perú.
    • Handle: RePEc:pcp:pucwps:wp00344
    as

    Download full text from publisher

    File URL: http://files.pucp.edu.pe/departamento/economia/DDD344.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cebula, Richard J., 1980. "IS-LM stability and economic policy effectiveness: Further observations," Journal of Macroeconomics, Elsevier, vol. 2(2), pages 181-183.
    2. Jose Rodriguez & Silvana Vargas, 2009. "Trabajo infantil en el Peru. Magnitud y perfiles vulnerables. Informe Nacional 2007-2008," Libros no PUCP / Books other publishers, Otras editoriales / Other publishers, number oit2009, November.
    3. H. R. Hudson, 1957. "A Model Of The Trade Cycle," The Economic Record, The Economic Society of Australia, vol. 33(66), pages 378-389, December.
    4. Silber, William L, 1971. "Monetary Policy Effectiveness: The Case of a Positively Sloped IS Curve," Journal of Finance, American Finance Association, vol. 26(5), pages 1077-1082, December.
    5. repec:bla:scandj:v:79:y:1977:i:2:p:260-70 is not listed on IDEAS
    6. Elizabeth W. Gilboy, 1939. "The Propensity to Consume: Reply," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 53(4), pages 633-638.
    7. Puckett, Richard H, 1973. "Monetary Policy Effectiveness: The Case of a Positively Sloped I-S Curve: Comment," Journal of Finance, American Finance Association, vol. 28(5), pages 1362-1364, December.
    8. Wang, Leonard F. S., 1980. "IS-LM stability and economic policy effectiveness: A note," Journal of Macroeconomics, Elsevier, vol. 2(2), pages 175-179.
    9. Burrows, Paul, 1974. "The Upward Sloping IS Curve and the Control of Income and the Balance of Payments," Journal of Finance, American Finance Association, vol. 29(3), pages 955-961, June.
    10. Wei-Bin Zhang, 2005. "Differential Equations, Bifurcations, and Chaos in Economics," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 5827, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cebula, Richard, 1984. "Money Multipliers and the Slopes of IS and LM: Comment," MPRA Paper 51515, University Library of Munich, Germany.
    2. Jack E. Gelfand & Thad W. Mirer, 1979. "A Note on Positively Sloped is Curves," The American Economist, Sage Publications, vol. 23(2), pages 73-76, October.
    3. Akhmet, Marat & Akhmetova, Zhanar & Fen, Mehmet Onur, 2014. "Chaos in economic models with exogenous shocks," Journal of Economic Behavior & Organization, Elsevier, vol. 106(C), pages 95-108.
    4. Wei-Bin Zhang, 2015. "Oscillations in a Growth Model with Endogenous Wealth, Resource, Housing, and Elastic Labour Supply," International Journal of Economics and Empirical Research (IJEER), The Economics and Social Development Organization (TESDO), vol. 3(9), pages 458-472, September.
    5. repec:beo:journl:v:62:y:2018:i:216:p:7-34 is not listed on IDEAS
    6. Wei-Bin Zhang, 2018. "Business Cycles, Growth, And Imported Energy In A Small-Open Growth Model," Oradea Journal of Business and Economics, University of Oradea, Faculty of Economics, vol. 3(2), pages 7-21, September.
    7. Alejandro Lugon Ceruti, 2012. "Endogenous Altruism In The Long Run," Documentos de Trabajo / Working Papers 2012-348, Departamento de Economía - Pontificia Universidad Católica del Perú.
    8. Joshi, Divya D. & Bhalekar, Sachin & Gade, Prashant M., 2023. "Controlling fractional difference equations using feedback," Chaos, Solitons & Fractals, Elsevier, vol. 170(C).
    9. Dubiel, Ivo, 1986. "Changes of social relevance in the transplantation of theories: the examples of economics and agronomics," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    10. Wei Bin ZHANG, 2016. "Oscillations In The Walrasian General Equilibrium Theory With Endogenous Wealth And Human Capital Accumulation," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 5(1), pages 1-41, January.
    11. Wei-Bin Zhang, 2020. "Global Development, Trade, Human Capital, And Business Cycles," Oradea Journal of Business and Economics, University of Oradea, Faculty of Economics, vol. 5(special), pages 9-29, June.
    12. Gabriel Rodríguez & Alfredo Vargas, 2012. "Impacto de expectativas políticas en los retornos del Índice General de la Bolsa de Valores de Lima," Revista Economía, Fondo Editorial - Pontificia Universidad Católica del Perú, vol. 35(70), pages 190-223.
    13. Wei-bin Zhang, 2020. "Education, Income, Wealth Inequality and Business Cycles in a General Equilibrium Growth Model," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 4, pages 607-618, December.
    14. Wei-Bin Zhang, 2018. "Business Cycles In A General Equilibrium Dynamic Model With Land Value And Rent," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 63(216), pages 7-34, January –.
    15. Wei-Bin Zhang, 2015. "Economic Oscillations in a Multi-Country Growth Model with Free Trade and Tourism," Eurasian Business & Economics Journal, Eurasian Academy Of Sciences, vol. 2(2), pages 1-19, February.
    16. K. Vela Velupillai, 2004. "Hicksian Visions and Vignettes on (Non-Linear) Trade Cycle Theories," Department of Economics Working Papers 0407, Department of Economics, University of Trento, Italia.
    17. Michael Kuklik & Nikita Cespedes, 2013. "Optimal Taxation and Life Cycle Labor Supply Profile," Documentos de Trabajo / Working Papers 2013-352, Departamento de Economía - Pontificia Universidad Católica del Perú.
    18. V. Ragupathy & Stefano Zambelli & K. Vela Velupillai, 2013. "A Non-linear Model of the Trade Cycle: Mathematical Reflections on Hugh Hudson's Classic," Australian Economic Papers, Wiley Blackwell, vol. 52(2), pages 115-125, June.
    19. Adam Krawiec & Tomasz Stachowiak & Marek Szydlowski, 2017. "The phase space structure of the oligopoly dynamical system by means of Darboux integrability," Papers 1708.02193, arXiv.org.
    20. G.C. Harcourt, 2014. "AEP and me: A short(ish) memoir," Australian Economic Papers, Wiley Blackwell, vol. 53(3-4), pages 255-259, December.
    21. wei-bin zhang, 2017. "Business Cycles with Progressive Income Taxation," International Journal of Business and Management, International Institute of Social and Economic Sciences, vol. 5(2), pages 78-95, November.

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics

    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:pcp:pucwps:wp00344. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/depucpe.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.