IDEAS home Printed from https://ideas.repec.org/a/eee/chsofr/v155y2022ics0960077921010262.html
   My bibliography  Save this article

Interaction between economies in a business cycle model

Author

Listed:
  • Amaral, Amaury S.
  • Camargo, Victor E.
  • Crepaldi, Antônio F.
  • Ferreira, Fernando F.

Abstract

In this work we study the interaction between two or three nonlinear dynamical macroeconomic idealized systems. The model is a modified version of the Bouali’s system. Only three economic variables were considered: foreign capital inflow, household savings, and the gross domestic product. It was studied possible patterns that can result from these dynamics as well as structural changes when the coupling parameter (inflow of external capital) varies, here chosen as control parameter. Firstly, the present model has multistability where limit cycles and strange attractors depend on the initial conditions. Moreover, to some values of the control parameter occurs synchronization between the economies. However, there is a range of control parameters where they can be unstable. So, we applied the Master Stability Function method in order to evaluate the stability analysis. We found the occurrence of stable synchronization when the coupling of the economies is symmetrical (bidirectional interaction) or asymmetrical (unidirectional). Instability is predominant for higher control parameter values.

Suggested Citation

  • Amaral, Amaury S. & Camargo, Victor E. & Crepaldi, Antônio F. & Ferreira, Fernando F., 2022. "Interaction between economies in a business cycle model," Chaos, Solitons & Fractals, Elsevier, vol. 155(C).
  • Handle: RePEc:eee:chsofr:v:155:y:2022:i:c:s0960077921010262
    DOI: 10.1016/j.chaos.2021.111672
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960077921010262
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.chaos.2021.111672?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. M. Ayhan Kose & Guy M. Meredith & Christopher M. Towe, 2005. "How Has NAFTA Affected the Mexican Economy? Review and Evidence," Springer Books, in: Rolf J. Langhammer & Lúcio Vinhas Souza (ed.), Monetary Policy and Macroeconomic Stabilization in Latin America, pages 35-81, Springer.
    2. William Barnett & Evgeniya Duzhak, 2010. "Empirical assessment of bifurcation regions within New Keynesian models," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 45(1), pages 99-128, October.
    3. Calderón, César & Fuentes, J. Rodrigo, 2014. "Have business cycles changed over the last two decades? An empirical investigation," Journal of Development Economics, Elsevier, vol. 109(C), pages 98-123.
    4. Aguiar-Conraria, LuI´s & Joana Soares, Maria, 2011. "Business cycle synchronization and the Euro: A wavelet analysis," Journal of Macroeconomics, Elsevier, vol. 33(3), pages 477-489, September.
    5. Lisa Sella & Gianna Vivaldo & Andreas Groth & Michael Ghil, 2016. "Economic Cycles and Their Synchronization: A Comparison of Cyclic Modes in Three European Countries," Post-Print hal-01701122, HAL.
    6. Torres, Alberto & Vela, Oscar, 2003. "Trade integration and synchronization between the business cycles of Mexico and the United States," The North American Journal of Economics and Finance, Elsevier, vol. 14(3), pages 319-342, December.
    7. Jordi Galí, 1992. "How Well Does The IS-LM Model Fit Postwar U. S. Data?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 709-738.
    8. Raj Nallari & Breda Griffith, 2011. "Understanding Growth and Poverty : Theory, Policy, and Empirics," World Bank Publications - Books, The World Bank Group, number 2281.
    9. Lisa Sella & Gianna Vivaldo & Andreas Groth & Michael Ghil, 2016. "Economic Cycles and Their Synchronization: A Comparison of Cyclic Modes in Three European Countries," Journal of Business Cycle Research, Springer;Centre for International Research on Economic Tendency Surveys (CIRET), vol. 12(1), pages 25-48, September.
    10. Catherine Kyrtsou & Constantinos E. Vorlow, 2005. "Complex Dynamics in Macroeconomics: A Novel Approach," Springer Books, in: Claude Diebolt & Catherine Kyrtsou (ed.), New Trends in Macroeconomics, pages 223-238, Springer.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Huang, Changwei & Luo, Yijun & Han, Wenchen, 2023. "Cooperation and synchronization in evolutionary opinion changing rate games," Chaos, Solitons & Fractals, Elsevier, vol. 172(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Caruso, Alberto, 2018. "Nowcasting with the help of foreign indicators: The case of Mexico," Economic Modelling, Elsevier, vol. 69(C), pages 160-168.
    2. Mr. Andrew J Swiston, 2010. "Spillovers to Central America in Light of the Crisis: What a Difference a Year Makes," IMF Working Papers 2010/035, International Monetary Fund.
    3. Jean Louis, Rosmy & Brown, Ryan & Balli, Faruk, 2011. "On the feasibility of monetary union: Does it make sense to look for shocks symmetry across countries when none of the countries constitutes an optimum currency area?," Economic Modelling, Elsevier, vol. 28(6), pages 2701-2718.
    4. Hideaki Hirata & M. Ayhan Kose & Chris Otrok, "undated". "Regionalization vs. Globalization," Working Paper 164456, Harvard University OpenScholar.
    5. Jose Manuel Caetano & Antonio Bento Caleiro, 2018. "On Business Cycles Synchronization: Some Directions For The Eurasia," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 6(3), pages 13-33.
    6. Saini, Seema & Ahmad, Wasim & Bekiros, Stelios, 2021. "Understanding the credit cycle and business cycle dynamics in India," International Review of Economics & Finance, Elsevier, vol. 76(C), pages 988-1006.
    7. Eduardo Loría & Emmanuel Salas, 2015. "Mexico and the United States: cycle synchronization,1980.1-2013.4," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 75-102, May.
    8. Bógalo, Juan & Poncela, Pilar & Senra, Eva, 2017. "Automatic Signal Extraction for Stationary and Non-Stationary Time Series by Circulant SSA," MPRA Paper 76023, University Library of Munich, Germany.
    9. Vivien Sainte Fare Garnot & Andreas Groth & Michael Ghil, 2018. "Coupled Climate-Economic Modes in the Sahel's Interannual Variability," Post-Print hal-01855370, HAL.
    10. von Furstenberg, George M., 2006. "Mexico versus Canada: Stability benefits from making common currency with USD?," The North American Journal of Economics and Finance, Elsevier, vol. 17(1), pages 65-78, March.
    11. Alberto Caruso, 2015. "Nowcasting Mexican GDP," Working Papers ECARES ECARES 2015-40, ULB -- Universite Libre de Bruxelles.
    12. Sainte Fare Garnot, Vivien & Groth, Andreas & Ghil, Michael, 2018. "Coupled Climate-Economic Modes in the Sahel's Interannual Variability," Ecological Economics, Elsevier, vol. 153(C), pages 111-123.
    13. Andreas Groth & Michael Ghil, 2017. "Synchronization of world economic activity," Post-Print hal-01701086, HAL.
    14. Juan B'ogalo & Pilar Poncela & Eva Senra, 2020. "Understanding fluctuations through Multivariate Circulant Singular Spectrum Analysis," Papers 2007.07561, arXiv.org, revised Aug 2023.
    15. Mr. Sebastian Sosa, 2008. "External Shocks and Business Cycle Fluctuations in Mexico: How Important are U.S. Factors?," IMF Working Papers 2008/100, International Monetary Fund.
    16. Chatelain, Jean-Bernard & Ralf, Kirsten, 2020. "Hopf Bifurcation from New-Keynesian Taylor Rule to Ramsey Optimal Policy," EconStor Open Access Articles, ZBW - Leibniz Information Centre for Economics.
    17. Kohn, David & Leibovici, Fernando & Szkup, Michal, 2020. "Financial frictions and export dynamics in large devaluations," Journal of International Economics, Elsevier, vol. 122(C).
    18. Mathan Satchi & Jonathan Temple, 2006. "Growth and labour markets in developing countries," Bristol Economics Discussion Papers 06/581, School of Economics, University of Bristol, UK.
    19. repec:hum:wpaper:sfb649dp2005-039 is not listed on IDEAS
    20. Andrés Felipe Londoño & Jorge Andrés Tamayo & Carlos Alberto Velásquez, 2012. "Dinámica de la política monetaria e inflación objetivo en Colombia: una aproximación FAVAR," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 30(68), pages 14-71, June.
    21. Fatma Erdem & Erdal Özmen, 2015. "Exchange Rate Regimes and Business Cycles: An Empirical Investigation," Open Economies Review, Springer, vol. 26(5), pages 1041-1058, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:chsofr:v:155:y:2022:i:c:s0960077921010262. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Thayer, Thomas R. (email available below). General contact details of provider: https://www.journals.elsevier.com/chaos-solitons-and-fractals .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.