Structure and Macroeconomic Performance: Heterogeneous Firms and Financial Fragility

  • Domenico Delli Gatti
  • Mauro Gallegati
Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 551)


In this paper we adopt a new macrodynamic tool, i.e. a system of non-linear difference equations describing the evolution over time of the first and second moments of the distribution of firms’ degrees of financial robustness captured by the ratio of the equity base to the capital stock - the equity ratio for short - which affects supply and capital accumulation decisions. For particular configurations of parameters the dynamic patterns of the average equity ratio and the variance generate irregular and asymmetric time series in which growth and fluctuations are jointly determined (fluctuating growth).


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Copyright information

© Springer-Verlag Berlin Heidelberg 2005

Authors and Affiliations

  • Domenico Delli Gatti
    • 1
  • Mauro Gallegati
    • 2
  1. 1.ITEMQUniversità CattolicaMilano
  2. 2.DEAUniversità di AnconaAncona

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