Research Project Title

Nonlinear Model of the Business Cycle

Session Type

Traditional Paper Presentation

Research Project Abstract

In this report we examine a nonlinear model for the business cycle. Following the work of Goodwin (1951), we begin with a standard linear model and then incorporate additional aspects of the business cycle to increase the model’s realism. In doing so, we arrive at Goodwin’s nonlinear accelerator model, which is readily seen as the unforced van der Pol oscillator. We use standard techniques from dynamical systems theory to analyze the van der Pol oscillator and then extend the model to include constant and periodic forcing. We conclude with an interpretation placing results obtained in a economic context.

Session Number

RS3

Location

Weyerhaeuser 205

Abstract Number

RS3-a

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Apr 28th, 9:15 AM Apr 28th, 10:45 AM

Nonlinear Model of the Business Cycle

Weyerhaeuser 205

In this report we examine a nonlinear model for the business cycle. Following the work of Goodwin (1951), we begin with a standard linear model and then incorporate additional aspects of the business cycle to increase the model’s realism. In doing so, we arrive at Goodwin’s nonlinear accelerator model, which is readily seen as the unforced van der Pol oscillator. We use standard techniques from dynamical systems theory to analyze the van der Pol oscillator and then extend the model to include constant and periodic forcing. We conclude with an interpretation placing results obtained in a economic context.