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Causal and Stochastic Elements in Business Cycles

An Essential Extension of Macroeconomics Leading to Improved Predictions of Data

  • Book
  • © 1996

Overview

Authors:
  1. Arvid Aulin

    1. The Finnish Academy of Science and Letters, Helsinki, Finland

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Part of the book series: Lecture Notes in Economics and Mathematical Systems (LNE, volume 431)

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Table of contents (6 chapters)

  1. Front Matter

    Pages I-XI
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  2. The Mathematical Tools

    • Arvid Aulin
    Pages 1-14

  3. The Lucas Growth Theory and its Generalization to Business Cycles

    • Arvid Aulin
    Pages 15-27

  4. The General Theory of Economic Growth and Business Cycles

    • Arvid Aulin
    Pages 28-44

  5. The Basic Business Cycles as the Causal Part of Business Cycles

    • Arvid Aulin
    Pages 45-77

  6. The Effects of Nonmaterial Values and Other Ignored Factors Upon Economic Growth

    • Arvid Aulin
    Pages 78-86

  7. An Alternative Vision of the Stochastic Element in Business Cycles

    • Arvid Aulin
    Pages 87-98

  8. Back Matter

    Pages 99-120
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Keywords

About this book

1. Facts: A leisure term with an unbounded value function, when added to utility in the Lucas (1988) 'mechanics of economic development', expands enormously the range of data covered by the theory. To explain this we have to ask two questions. First: why leisure would be so much desired? Perhaps because leisure is one's own time and such a leisure term means an unbounded value of individual freedom. But why leisure is economically productive, as implied by the results obtained in this study? Perhaps because cognitive innovations often occur during the time which in economics is registered as leisure? Then an unbounded leisure term would also make room for an unbounded creation of knowledge, as distinguished from the mere transmission of knowledge in education and training. In any case the leisure term seems to act as if it where the'hole' through which strong nonmaterial values affect economics. The ensuing 'extended mechanics' is derived in Chapters 4-6 and proves to involve an extension of growth theory as well as a theory of the causal part of business cycles. Their empirical verification is given by showing (i) that the existence of the two Basic Growth Paths derived from this theory, defining its Growth Type 1 and Growth Type 2, respectively, is verified already by the statistics collected by Solow (1957) but ignored so far (see Chapter 5 of the present study); one of them, viz.

Authors and Affiliations

  • The Finnish Academy of Science and Letters, Helsinki, Finland

    Arvid Aulin

Bibliographic Information

  • Book Title: Causal and Stochastic Elements in Business Cycles

  • Book Subtitle: An Essential Extension of Macroeconomics Leading to Improved Predictions of Data

  • Authors: Arvid Aulin

  • Series Title: Lecture Notes in Economics and Mathematical Systems

  • DOI: https://doi.org/10.1007/978-3-642-95738-3

  • Publisher: Springer Berlin, Heidelberg

  • eBook Packages: Springer Book Archive

  • Copyright Information: Springer-Verlag Berlin Heidelberg 1996

  • Softcover ISBN: 978-3-540-60593-5Published: 19 February 1996

  • eBook ISBN: 978-3-642-95738-3Published: 06 December 2012

  • Series ISSN: 0075-8442

  • Series E-ISSN: 2196-9957

  • Edition Number: 1

  • Number of Pages: XI, 116

  • Topics: Economic Theory/Quantitative Economics/Mathematical Methods

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