Dynamics of a Four-Dimensional Economic Model

Gheorghe Moza (), Oana Brandibur and Ariana Găină
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Gheorghe Moza: Department of Mathematics, Politehnica University of Timisoara, 300006 Timisoara, Romania
Oana Brandibur: Department of Mathematics, West University of Timisoara, 300223 Timisoara, Romania
Ariana Găină: Department of Mathematics, West University of Timisoara, 300223 Timisoara, Romania

Mathematics, 2023, vol. 11, issue 4, 1-15

Abstract: The interdependency between interest rates, investment demands and inflation rates in a given economy has a continuous dynamics. We propose a four-dimensional model which describes these interactions by imposing a control law on the interest rate. By a qualitative analysis based on tools from dynamical systems theory, we obtain in the new model that the three economic indicators can be stabilized to three equilibrium states.

Keywords: dynamical systems; bifurcation diagrams; economic models; local dynamics (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2023
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