2014/12/23 by Matheus R. Grasselli, Matheus Grasselli, Grasselli, Matheus +2 · 2 citations
Economics, Econometrics and Finance · Mathematics · #Dynamical Systems (math.DS) #Economic Theory and Policy #Economic theories and models #FOS: Economics and business #FOS: Mathematics #General Finance (q-fin.GN) #Monetary Policy and Economic Impact #math.DS #q-fin.GN
paper · pdf · doi:10.48550/arxiv.1412.7500
arxiv created 2014/12/23 · openalex publication_date 2014/12/23 · arxiv updated 2014/12/24 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
We study a monetary version of the Keen model by merging two alternative extensions, namely the addition of a dynamic price level and the introduction of speculation. We recall and study old and new equilibria, together with their local stability analysis. This includes a state of recession associated with a deflationary regime and characterized by falling employment but constant wage shares, with or without an accompanying debt crisis. We also emphasize some new qualitative behavior of the extended model, in particular its ability to produce and describe repeated financial crises as a natural pace of the economy, and its suitability to describe the relationship between economic growth and financial activities.