Business cycle modeling between financial crises and black swans: Ornstein–Uhlenbeck stochastic process vs Kaldor deterministic chaotic model

  title={Business cycle modeling between financial crises and black swans: Ornstein–Uhlenbeck stochastic process vs Kaldor deterministic chaotic model},
  author={Giuseppe Orlando and Giovanna Zimatore},
Business cycles are oscillations in the economy because of recessions and expansions. In this paper we investigate the oscillation of the gross domestic product as a result of its relations with the other main macroeconomic variables such as capital, consumption, and investment. There is a long-standing debate about chaos and non-linear dynamics in economy and even the usefulness of those concepts has been questioned. Stochastic modeling has proven to be able to simulate reality fairly well… 
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