Concluding Remarks

Abstract

The foregoing presentation has, hopefully, made it evident that dynamical economics can be enriched by incorporating recent developments in the theory of nonlinear dynamical systems. However, a few final remarks seem to be in order. The general tendency in all mathematical theorems and economic applications presented in this short survey of nonlinear dynamics is that even the simplest dynamical systems may involve intuitively unexpected phenomena or highly complicated motions of the state variables. While traditional investigations of an evolving economy (especially in business cycle theory) have concentrated on regularity aspects, and while recent revivals of (new)-classical macroeconomics scroll the recognized irregularities back to the noneconomic exogenous world, nonlinear dynamical systems allow for an entirely new theoretical attitude toward an understanding of cyclical motion which must not necessarily be irregular or chaotic. By an appropriate choice of nonlinearities it is almost always possible to model a desired dynamical phenomenon which is believed to prevail in reality.