A long run theory of effective demand: Modelling macroeconomic systems with hysteresis

详细信息   

• 作者：Setterfield ; Mark
• 学历：Doctor
• 年：1992
• 关键词：Social sciences ; Great Britain ; economic growth
• 毕业院校：Dalhousie University
• 专业：Economic theory
• ISBN：9780315801486,0315801484
• CBH：NN80148
• Country：Canada
• 语种：English
• FileSize：12941254
• Pages：320

文摘

Do high rates of economic growth create conditions favourable to their own maintenance,or can a period of high growth "sow the seeds of its own destruction?" This question is addressed by applying self reinforcing mechanisms (hysteresis,cumulative causation and lock in$\sp1$) to the theory of growth and structural transformation. We begin by contrasting an economic methodology based on hysteresis with the methodology underlying conventional equilibrium analysis. A model of cumulative causation is then developed,the dynamics of which are such that high growth in the present period creates conditions conductive to high rates of growth in subsequent periods. When this model is extended to allow for endogenously induced technological and institutional changes,however,it becomes clear that inefficient technological and/or institutional evolution can cause the dynamics of high growth to break down. The extended model is shown to be of a more generally hysteretic nature than its predecessor. Finally,the theoretical insights of the thesis are applied to the historical experience of the British economy. Evidence on this experience suggests that Britain's relative economic rise and subsequent relative decline exhibit elements of the dynamics of self reinforcing mechanisms. ftn$\sp1$See,for example,R. Cross and A. Allen (1988) "on the history of hysteresis," in R. Cross (ed.) Unemployment,Hysteresis and the Natural Rate,Oxford: Basil Blackwell on hysteresis,N. Kaldor (1972) "The irrelevance of equilibrium economics," Economic Journal,82,1237-55 on cumulative causation,and W. B. Arthur (1988) "Self reinforcing mechanisms in economics," in P. W. Anderson,K. Arrow and D. Pines (eds.) The Economy as an Evolving Complex System,Reading,Mass.: Addison-Wesley on lock in.