The Economy as a Chaotic Growth Oscillator

Richard M. Goodwin

Chapter 11 in The Dynamics of the Wealth of Nations, 1993, pp 300-310 from Palgrave Macmillan

Abstract: Abstract Schumpeter was a pioneer in the analysis of the dynamics of the modern industrialized economies. When he said that the cycle is simply the form that growth takes, he made one of the most profound contributions to the understanding of the vicissitudes of contemporary societies. In perceiving the central importance of Kondratieff’s detection of the existence of long waves of the order of fifty years, he posed a difficult but vital problem in the statistical and theoretical treatment of economics. He proposed three Kitchins to each Juglar and six Juglars to each Kondratieff cycle — a suggestive hypothesis but one far too simple; it is based on the too crude conception of the independently additive nature of the fluctuations of the economy. There is no possibility that each of the cycles could behave in independence of the other two. One cannot be severely critical of him about this since he was merely using the common conception of linear decomposition of economic time series in econometric analysis. Furthermore it is no easy task to formulate a single model which will explain the complex behaviour of economic time series.

Keywords: Business Cycle; Real Wage; Chaotic Attractor; Exogenous Shock; Unit Labour Cost (search for similar items in EconPapers)
Date: 1993
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DOI: 10.1007/978-1-349-22728-0_12

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