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Multi-scale Economic Dynamics: The Micro–Macro Wealth Dynamics and the Two-Level Imbalances of the Euro Crisis

Author

Listed:
  • Hanchao Yang

    (Stevens Institute of Technology)

  • Chenjie Shao

    (Stevens Institute of Technology)

  • Khaldoun Khashanah

    (Stevens Institute of Technology)

Abstract

We introduce a system of ordinary differential equations to model the micro–macro wealth dynamics of interactions between international enterprise competitiveness and the macroeconomic growth as an open system. The novelty of the approach is to postulate dynamic interaction between domestic and foreign companies and link this interaction to the GDP growth. The objective is to construct a micro–macro wealth dynamic model. By analyzing the market share data of the retail industry of 13 largest Eurozone countries as a system, our model suggests that the predator–prey relation exists. Under certain regimes, it is shown that foreign companies have a negative contribution to the GDP growth. Such dynamics reveals two levels of imbalances: company competitiveness and national economic growth.

Suggested Citation

  • Hanchao Yang & Chenjie Shao & Khaldoun Khashanah, 2019. "Multi-scale Economic Dynamics: The Micro–Macro Wealth Dynamics and the Two-Level Imbalances of the Euro Crisis," Computational Economics, Springer;Society for Computational Economics, vol. 53(2), pages 587-616, February.
    • Handle: RePEc:kap:compec:v:53:y:2019:i:2:d:10.1007_s10614-017-9748-7
    DOI: 10.1007/s10614-017-9748-7
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    References listed on IDEAS

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