Oscillatory dynamics of investment and capacity utilization

R.E. Greenblatt

Physica A: Statistical Mechanics and its Applications, 2017, vol. 465, issue C, 486-493

Abstract: Capitalist economic systems display a wide variety of oscillatory phenomena whose underlying causes are often not well understood. In this paper, I consider a very simple model of the reciprocal interaction between investment, capacity utilization, and their time derivatives. The model, which gives rise periodic oscillations, predicts qualitatively the phase relations between these variables. These predictions are observed to be consistent in a statistical sense with econometric data from the US economy.

Keywords: Econophysics; Business cycle; Investment; Capacity utilization; Economic dynamics (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:465:y:2017:i:c:p:486-493

DOI: 10.1016/j.physa.2016.08.025

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