Nonlinear Model of the Business Cycle
Faculty Sponsor
Richard Cangelosi, cangelosi@gonzaga.edu
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
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.
