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Unformatted text preview: 56 Economic Dynamics Figure 2.14. only one fixed point, namely p = 0. In the case of the logistic growth equation x ( t ) = kx ( a x ) there are two fixed points, one at x 1 = 0 and the other at x 2 = a . In example 2.4 on demand and supply the fixed point, the equilibrium point, is given by p = c a b d which is also the fixed point for example 2.5. For the HarrodDomar growth model (example 2.8) there is only one stationary point, only one equilibrium point, and that is Y = 0. For the Solow growth model, in which the production function conforms to a CobbDouglas (example 2.9), there are two stationary values, one at k 1 = 0 and the other at k 2 = sa n + ( 1 1 ) Whether a system is moving towards a fixed point or away from a fixed point is of major importance. A trajectory is said to approach a fixed point if x ( t ) x as t , in this case the fixed point is said to be an attractor . On the other hand, if x ( t ) moves away from...
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This note was uploaded on 12/14/2011 for the course ECO 3023 taught by Professor Dr.gwartney during the Fall '11 term at FSU.
- Fall '11