Keynesian monetary growth dynamics in open economies

Chiarella, C; Flaschel, P

Keynesian monetary growth dynamics in open economies

Chiarella, C Flaschel, P

Permalink

Publication Type:: Journal Article
Citation:: Annals of Operations Research, 1999, 89 pp. 35 - 59
Issue Date:: 1999-12-01

Closed Access

	Filename	Description	Size
	2006014880OK.pdf		261.49 kB	Adobe PDF	View/Open

Copyright Clearance Process

Recently Added
In Progress
Closed Access

This item is closed access and not available.

Full metadata record

Field	Value	Language
dc.contributor.author	Chiarella, C	en_US
dc.contributor.author	Flaschel, P	en_US
dc.date.issued	1999-12-01	en_US
dc.identifier.citation	Annals of Operations Research, 1999, 89 pp. 35 - 59	en_US
dc.identifier.issn	0254-5330	en_US
dc.identifier.uri	http://hdl.handle.net/10453/13928
dc.description.abstract	We investigate an open economy monetary growth model with sluggish price and quantity adjustments. It integrates the real dynamics of Rose's employment cycle, an inflationary dynamics of Cagan type, Metzlerian inventory dynamics and Dornbusch's exchange rate dynamics, implying eight laws of motion, two for each subdynamics. These intrinsically nonlinear 8D dynamics are asymptotically stable for low adjustment speeds of prices and expectations, give rise to Hopf bifurcations as these adjustment parameters are increased and lead to cyclically explosive behavior thereafter. Two extrinsic nonlinearities are therefore added, one in capital flows and the other a kinked Phillips curve. These two nonlinearities modify the dynamics radically, limiting them to economically meaningful domains even for extreme parameter choices.	en_US
dc.relation.ispartof	Annals of Operations Research	en_US
dc.subject.classification	Operations Research	en_US
dc.title	Keynesian monetary growth dynamics in open economies	en_US
dc.type	Journal Article
utslib.citation.volume	89	en_US
utslib.for	140199 Economic Theory not elsewhere classified	en_US
utslib.for	01 Mathematical Sciences	en_US
utslib.for	08 Information and Computing Sciences	en_US
utslib.for	15 Commerce, Management, Tourism and Services	en_US
dc.location.activity	ISI:000081261500004	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
utslib.copyright.status	closed_access
pubs.publication-status	Published	en_US
pubs.volume	89	en_US

Abstract:

We investigate an open economy monetary growth model with sluggish price and quantity adjustments. It integrates the real dynamics of Rose's employment cycle, an inflationary dynamics of Cagan type, Metzlerian inventory dynamics and Dornbusch's exchange rate dynamics, implying eight laws of motion, two for each subdynamics. These intrinsically nonlinear 8D dynamics are asymptotically stable for low adjustment speeds of prices and expectations, give rise to Hopf bifurcations as these adjustment parameters are increased and lead to cyclically explosive behavior thereafter. Two extrinsic nonlinearities are therefore added, one in capital flows and the other a kinked Phillips curve. These two nonlinearities modify the dynamics radically, limiting them to economically meaningful domains even for extreme parameter choices.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/13928