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The Hicksian trade cycle with floor and ceiling dependent on capital stock. (English) Zbl 1162.91494

Summary: This article reconsiders the Hicksian multiplier - accelerator model with ‘floor’ and ‘ceiling’. The new thrust is that these constraints are tied to the actual stock of capital, the floor to the depreciation on this stock, the ceiling to capital as a limiting production factor according to the fixed proportions technology that also underlies the principle of acceleration. For capital formation just the Hicksian investment theory is used. The result is one unified model creating economic growth and growth rate cycles.

MSC:

91B62 Economic growth models
37N40 Dynamical systems in optimization and economics
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