Mathematical Dynamics of Economic Growth as Effect of Internal Savings

Alexei Krouglov ()

MPRA Paper from University Library of Munich, Germany

Abstract: Paper introduces mathematical models describing long-time effects of real savings on economic growth. Models are built for single-product and multiple-product economy with market forces presented through the system of ordinary differential equations. Modeling results show a limited long-run economic growth for occasional and constant-rate systematic internal savings, a steady long-run economic growth if acceleration rate of internal savings lies within the proper limit for every industry, and a steady long-run economic decline if acceleration rate of internal savings exceeds the suitable limit for certain industry. Modeling outcome also suggests that a long-run economic growth requires direct investment of internal savings into appropriate investment vehicles with exclusion from savings-investment chain the interest-rate-bearing bank accounts with clear danger of suffering a long-run economic decline in case of violation of the requirement.

Keywords: Business Fluctuations; Economic Growth; Savings; Investment (search for similar items in EconPapers)
JEL-codes: E32 O41 (search for similar items in EconPapers)
Date: 2006-10-15
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:1262

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