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Economics, Control Theory, and the Phillips Machine

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  • Brian Hayes

Abstract

Can the same mathematical control laws that smooth out oscillations in the flight of an airplane also moderate economic cycles of boom and bust? Attempts to bring together the intellectual traditions of control engineering and economics go back at least as far as the hydraulic analog computer of A. W. H. Phillips, circa 1950. Today, economic policymakers remain committed to the ideal of controlling business cycles; it remains an open question whether tools from control theory might help to refine their strategies.

Suggested Citation

  • Brian Hayes, 2011. "Economics, Control Theory, and the Phillips Machine," ASSRU Discussion Papers 1101, ASSRU - Algorithmic Social Science Research Unit.
    • Handle: RePEc:trn:utwpas:1101
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    File URL: http://www.assru.economia.unitn.it/files/DP_01_2011.pdf
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    References listed on IDEAS

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    1. Leeson,Robert (ed.), 2000. "A. W. H. Phillips: Collected Works in Contemporary Perspective," Cambridge Books, Cambridge University Press, number 9780521571357, September.
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    5. Rudebusch, Glenn D, 2005. "Assessing the Lucas Critique in Monetary Policy Models," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 37(2), pages 245-272, April.
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