A NOTE ON IS‐LM AND STOCK ADJUSTMENT PROCESSES

Andrea Boitani, N. Christodoulakis

Risultato della ricerca: Contributo in rivistaArticolo in rivista

Abstract

A discrete‐time model of a closed economy is employed in order to introduce the whole dynamics of stock adjustments in the IS‐LM diagram. Discrete‐time modeling allows us to represent the traverse process from the initial stationary state equilibrium to the new one by means of a family of intermediary IS(t) and LM(t) curves intersecting at each t to determine the appropriate short run equilibrium. Sufficient conditions for the dynamic process to be non‐cyclical are derived under plausible assumptions. Two appendices provide the stability analysis and a numerical simulation of the model used. Copyright © 1989, Wiley Blackwell. All rights reserved
Lingua originaleEnglish
pagine (da-a)67-85
Numero di pagine19
RivistaMetroeconomica
Volume40
DOI
Stato di pubblicazionePubblicato - 1989

Keywords

  • IS-LM
  • Stock adjustment

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