Advanced Economic DynamicsPing Chen
Issues, Methods, and
School of Thoughts
实事求是,具体分析 多层次,多维度,历史,比较,动态,和演化的分析 – 从复杂到简要
历史线索 案例实证的收集,归纳,分类 寻找综述文献 -理清前人争论的要点,思路 研究具体机制,模型 寻找经验证据或反例
不怯上问 – 敢于质疑权威和流行的观点 不耻下问 – 虚心求教专家和平民的经验
四大课题,突破在望
Nonlinear DD-SS Curve – Multiple Equilibrium and Endogenous Instability
Stochastic Models of Persistent Cycles and Persistent Fluctuations
Nonlinear Deterministic Model under External Shocks
Interruptive Technology and Market Extent
四大难题,有路可寻
Keynes and Neo-Classical SynthesisMarginal and Non-Marginal PricingCredit Expansion and Financial CrisisEquilibrium and Non-equilibrium
Measurement of Economic Stock and Flow
先学可探,后学可成愿与同学志士,共同创建一个比新古典经济学更一般更实际的数理经济学体系:
时间序列的非稳态非线性分析企业动态行为的宏观环境技术竞争的产业兴衰理论金融中介的新陈代谢模型宏观系统的热力学与统计力学经济物理学演化动力学
Fundamental Issues in History
Adam Smith: Division of LaborWealth is created by increasing division
of labor.Dilemma: Invisible hand vs. market
extentPrice and Value: Labor Cost
Price Deviations from Value:Cost vs. Psychological Choice
Marx: surplus value created by labor
Marginal revolutionThe problem of supply curve under
increasing return to scale
Nature of Business Cycles
Marx: Explosive oscillation in market economy
Austrian: intrinsic credit cycles driven by central bank
Schumpeter: Creative destruction and biological clock
Frisch: Noise-driven damped oscillator
Keynesian revolution and neo-classical compromise
The challenge of the Great Depression Austrian: credit cycle and banking crisis Keynes: animal spirits and government
interference Neo-classical syntheses: IS-LM curve – a big
retreat from Keynesian general theory Friedman: monetary policy
Lucas Counter-Revolution:From Capital Market to Labor Market
Friedman (monetarist): Natural rate of unemployment
Becker: Intertemporal substitutionMuth: Rational expectationsLucas (new classical): Lucas critique of
control theory and microfoundations under rational expectations
New Keynesian defense: labor rigidity
Supply Side
Real business cycle schoolThe HP trend and cyclesWelfare state and tax policy
Decent voice
Fundamental Keynesian and post-Keynesian: financial instability (Minsky)
Austrian: endogenous cycle and evolutionary approach of political economics
Methodological Progress
Bounded rationality (Simon) and business psychology (Tversky and Kaneman)
Mandelbrot: Levy distribution and fractal Brownian motion
Experimental economics and rule of game (V. Smith)
Information asymmetry Increasing returns (Krugman) and path-
dependence (Arthur)
From Division of Labor to Evolutionary Biology
Needham’s question and Prigogine’s thermodynamics of evolution (1972)
Division of labor and economy of scaleTheoretical biology: stability vs.
complexity (May, 1973)Cultural factor in specie competition:
race between individualism & collectivism (1987)
From Economic Chaos to Evolutionary Economics
First evidence of economic chaos from monetary data (Chen, 1985)
Tinbergen, Simon, Samuelson, Rostow, and Solow
Debate with econometricians: noise (Brock) vs. chaos (Chen)
Detrending and the Copernicus problem (1993), Zarnowitz and Kydland
Non-stationary time-frequency analysis (1994)
Understanding Economic Instability & Coherence: From Persistent Cycles to Endogenous Fluctuations
Frisch model and harmonic Brownian motion (Chen, 1999)
Principle of large numbers and Lucas fallacy (Chen, 1999-2002)
Birth-death process and economic coherence (Chen 2001, Li 2002)
Dynamic Microeconomics and Strategic Pricing under Limited Market and Economic Physics (Chen 2002)
Co-existence of technologies and excess capacity
Lotka-Volterra wavelet and product cycle Gabor wavelet and coherent state in quantum
mechanics Perfect information=total confusion under
Wigner-Gabor-Qian representation
Testing Ground: The Great Depression and The New Economy Bubble
Temin and Rothbad: failure of monetary theory
Lucas: persistence and labor rigidity Feldstein: Interruptive technology Summerce: Two types of business cycles New economy bubble and excess capacity
Economic Instability and Economic Resilience
Dynamic DD-SS and multiple equilibrium
Conflicting trends and uncertainty in IS-LM curve
Three level structure: micro-finance-macro
Intrinsic instability in industry competition and financial market
Proper competition and entry regulation
Rethinking Economic Order
Equilibrium and non-equilibrium order Constructive role of life rhythms and
increasing entropy Wavelet rather than cycle as the building
block of living movements Evolutionary process with necessity and
chance Diagnosis rather than prediction Time window and relevant information
New Ideas
U-shaped and multi-humped distribution Imperfect cycles, complex cycles, persistent
cycles, biological clock, and color chaos Trade-off between complexity & stability General Smith Theorem: division of labor is
limited by market extent, number of resources, and environment fluctuations
Product cycle, excess capacity, and market rationality of investment strategy
Unsolved Issues
Formulation of two-way causality Structural information vs. horizontal
information Origin of (firm, state) boundaries Evolutionary mechanism of hierarchical
structure Dynamic pricing strategy under varying
economy and business cycles Risk management under deterministic and
stochastic uncertainty Distribution of wealth with nonlinear utility