Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: Jan, 1972, Volume 40, Issue 1

Stochastic Implications of Orbital Asymptotic Stability of a Nonlinear Trade Cycle Model<69:SIOOAS>2.0.CO;2-9
p. 69-86

R. F. Kosobud, W. D. O’Neill

The nonlinear Kaldor theory of macroeconomic business cycles is combined with a classical growth mechanism to derive a deterministic model of business cycle phenomena. Sufficient conditions for the existence, uniqueness, and orbital asymptotic stability of a limit cycle are given. It is shown that the model also exhibits stochastic stability when the deterministic variables are randomly disturbed.

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