Nonlinear Kaldor model augmented with retardation and anticipation

Akio Matsumoto () and Ferenc Szidarovszky ()
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Akio Matsumoto: Chuo University
Ferenc Szidarovszky: Corvinus University

Annals of Operations Research, 2024, vol. 337, issue 3, No 9, 937-958

Abstract: Abstract In this paper, we introduce the delayed-advanced Kaldorian business cycle model and consider how time-delay and time-advance affect economic fluctuations. Given the asymptotic stability of the original Kaldor model, we first show that an approximated Kaldor model by a Taylor series expansion can accurately describe the dynamics of the delayed Kaldor model. We also confirm that the delay has a destabilizing effect. When time-delay is replaced with time-advance, we have an advanced Kaldor model. Taking the advanced capital stock formulation, we derive the stability conditions and find that the time-advance has a stabilizing effect. Lastly, we examine these opposite-signed effects in a modified delayed-advanced model.

Keywords: Kaldorian business cycle; Nonlinear investment function; Retardation; Anticipation; Delay-advanced equation; Approximation method (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10479-023-05415-1

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