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Complex dynamics of multi-regional economic interactions

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Abstract

Dynamical systems are being employed over the last decades to investigate complex behaviors in traditional fields as engineering and physics, but also in biology, medicine, economics and financial markets. In this regard, the modeling of economic systems have had an increasing importance to support proper government interventions or enterprises investment decisions. This work investigates dynamical behavior of multi-regional economic interaction. A mathematical model proposed by Ishiyama and Saiki is employed considering that an economic coupling mechanism is based on investment decisions made by global companies. This model is based on Kaldor–Goodwin model for independent countries. Numerical simulations analyze three different scenarios related to the economic behavior of isolated countries. Complex dynamics can emerge from the interaction of both countries including situations where two uncoupled countries with periodic behaviors turn to a chaotic situation when the coupling is established. This behavior reinforces the importance of nonlinear analysis of economic systems in order to better understand their behavior.

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Acknowledgements

The authors would like to acknowledge the support of the Brazilian Research Agencies CNPq, CAPES and FAPERJ.

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  1. Center for Nonlinear Mechanics, COPPE - Department of Mechanical Engineering, Universidade Federal do Rio de Janeiro, Rio de Janeiro, 21941-972, Brazil

    Francisco Heitor I. Pereira-Pinto & Marcelo Amorim Savi

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Correspondence to Marcelo Amorim Savi.

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Pereira-Pinto, F.H.I., Savi, M.A. Complex dynamics of multi-regional economic interactions. Nonlinear Dyn 102, 1151–1171 (2020). https://doi.org/10.1007/s11071-020-05658-8

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