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Relevance of Chaos and Strange Attractors in the Samuelson-Hicks Oscillator

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  • Jean-François Verne

    (Saint-Joseph University of Beirut, Lebanon)

Abstract

In this paper, we look for the relevance of chaos in the well-known Hicks-Samuelson's oscillator model investigating the endogenous fluctuations of the national income between two limits: full employment income and under-employment income. We compute the Lyapunov exponent, via Monte- Carlo simulations, to detect chaos in the evolution of the income between both limits. In the case of positive Lyapunov exponent and large values of the parameter (i.e. marginal propensity to consume and technical coefficient for capital), the evolution of income is seen to be chaotic. The model also may contain a quasi-periodic attractor that can be chaotic or not.

Suggested Citation

  • Jean-François Verne, 2021. "Relevance of Chaos and Strange Attractors in the Samuelson-Hicks Oscillator," Economic Thought, World Economics Association, vol. 10(1), pages 32-45, July.
    • Handle: RePEc:wea:econth:v:10:y:2021:i:1:p:32
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    References listed on IDEAS

    as
    1. Frank Westerhoff, 2006. "Samuelson's multiplier-accelerator model revisited," Applied Economics Letters, Taylor & Francis Journals, vol. 13(2), pages 89-92.
    2. Puu, Tonu & Gardini, Laura & Sushko, Irina, 2005. "A Hicksian multiplier-accelerator model with floor determined by capital stock," Journal of Economic Behavior & Organization, Elsevier, vol. 56(3), pages 331-348, March.
    3. Jean-François Verne & Carole Doueiry Verne, 2019. "Chaos in Lebanese GDP: The Lorenz Attractor Approach," Economics Bulletin, AccessEcon, vol. 39(3), pages 1958-1967.
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