Stability and the structure of continuous-time economic models

H.J. Nieuwenhuis, L. Schoonbeek

OnderzoeksoutputAcademicpeer review

5 Citaten (Scopus)


In this paper we investigate the relationship between the stability of macroeconomic, or macroeconometric, continuous-time models and the structure of the matrices appearing in these models. In particular, we concentrate on dominant-diagonal structures. We derive general stability results for models with first-order as well as second-order adjustment lags. Recalling that many existing macroeconometric models are 'marginally' unstable, we apply our results to a well-known prototype model, i.e. the model of the United Kingdom of Bergstrom and Wymer. Our analysis explains, in terms of the structure of the matrices involved, why this model is marginally unstable.

Originele taal-2English
Pagina's (van-tot)311-340
Aantal pagina's30
TijdschriftEconomic Modelling
Nummer van het tijdschrift3
StatusPublished - jul-1997

Citeer dit