The visible hand. Synergetic microfoundation of macroeconomic dynamics
The book starts from a brief presentation and characterization of synergetics as a dynamic decision theory making use of the concepts: decision configuration, decision process, transition rates and the functional representation of individual transition rates -- on the basis of which the typical equations of motion are derived. It then considers various applications of synergetics to the foundations of certain business cycle theories. The first application concerns the transformation of a well-known Keynesian model of business fluctuations into a microfounded synergetic model (of the same type) of the investment decision of entrepreneurs. An application of the Poincaré-Bendixson theorem and a detailed numerical investigation of the model is provided. Chapter 3 of the book then extends this analysis by treating the decision of producers methodologically in the same way -- again providing limit cycle results and simulations of the model employed. Chapter 5 then adds the same treatment for the consumption decision of households and represents the last step in stepwise inclusion of microeconomic decision processes on the basis of a synergetic reformulation of decision theory. This final extension of an orthodox business cycle model is based on three coupled decision processes and correspondingly three laws of motion and it can generate so-called deterministic chaos in particular. The concluding part of the book then briefly informs on the empirical evidence for such model types.
scientific article; zbMATH DE number 108237