Eventual periodicity in the two-sector RSL model: equilibrium vis-à-vis optimum growth

Liuchun Deng (), Minako Fujio and M. Khan
Additional contact information
Liuchun Deng: Yale-NUS College
Minako Fujio: Yokohama National University

Economic Theory, 2021, vol. 72, issue 2, No 8, 615-639

Abstract: Abstract This paper investigates the well-known phenomenon of eventual periodicity of Li–Yorke chaos in the context of the two-sector Robinson–Shinkai–Leontief model of economic growth. It locates its (i) presence under specific parameter restrictions that include the extreme classical saving specification, and its (ii) absence in savings generated by the optimization of an infinitely-lived representative agent with perfect foresight. These results in which rare events, chaos and stability are all brought together under the rubric of upward and downward inertia, while of substantive economic interest of their own, also highlight phenomena in economic dynamics that may go towards a clearer definitional understanding of chaotic systems.

Keywords: Two-sector model; Equilibrium growth; Optimum growth; Eventual periodicity; Chaos (search for similar items in EconPapers)
JEL-codes: C60 D90 O21 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://link.springer.com/10.1007/s00199-020-01301-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joecth:v:72:y:2021:i:2:d:10.1007_s00199-020-01301-0

Ordering information: This journal article can be ordered from
http://www.springer. ... eory/journal/199/PS2

DOI: 10.1007/s00199-020-01301-0

Access Statistics for this article

Economic Theory is currently edited by Nichoals Yanneils

More articles in Economic Theory from Springer, Society for the Advancement of Economic Theory (SAET) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().