Department of Mathematics
Zhangzhou Teachers College
Zhangzhou 363000, China
email: mathcai@hotmail.com
Jianping Cai
Abstract:
The distinction between investment decisions and
implementation leads us to formulate a new IS-LM business
cycle model. It is shown that the dynamics depends crucially
on the time delay parameter - the gestation time period of
investment. The Hopf bifurcation theorem is used to predict
the occurrence of a limit cycle bifurcation for the time
delay parameter. Our analysis shows that the limit cycle
behavior is independent of the assumption of nonlinearity
of the investment function. An example is given to verify
the theoretical results.
Submitted November 17,2004. Published February 1, 2005.
Math Subject Classifications: 37G15, 91B62.
Key Words: Hopf bifurcation; business cycle; IS-LM model; time delay.
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Jianping Cai Department of Mathematics Zhangzhou Teachers College Zhangzhou 363000, China email: mathcai@hotmail.com |
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