Presenter Information

KWAN HO LEEFollow

Academic Field

Mathematics

Faculty Mentor Name

Benjamin Esham

Presentation Type

Poster Presentation

Abstract

We are studying how the presence of nonlinear terms in the supply and demand model changes the price behavior of the system. Our analysis focuses on discrete dynamical systems. We start with a simple linear supply and demand model of two markets interacting. Afterwards, we add nonlinear terms and observe the results. We hypothesize that the presence of nonlinearity in the supply and demand model, with two interrelated markets, will exhibit chaotic price behavior. Furthermore, we expect that the system will become chaotic via period-doubling bifurcations, and that all orbits will converge to a strange attractor.

Keywords

Linear, nonlinear, cobweb, market price, chaotic

Start Date

10-4-2015 11:15 AM

End Date

10-4-2015 12:00 PM

Location

SERC House of Fields

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Apr 10th, 11:15 AM Apr 10th, 12:00 PM

A Simple Nonlinear Economic Models of Market Price; The Case of the Cobweb

SERC House of Fields

We are studying how the presence of nonlinear terms in the supply and demand model changes the price behavior of the system. Our analysis focuses on discrete dynamical systems. We start with a simple linear supply and demand model of two markets interacting. Afterwards, we add nonlinear terms and observe the results. We hypothesize that the presence of nonlinearity in the supply and demand model, with two interrelated markets, will exhibit chaotic price behavior. Furthermore, we expect that the system will become chaotic via period-doubling bifurcations, and that all orbits will converge to a strange attractor.