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Über dieses Buch

The aim of this book and a brief description of its con­ tents appear in chapter I. The purpose of this preface is to express our thanks to various people and organizations. Professor Peter Groenewegen of Sydney University and Dr. Michael Krueger of the University of Massachusetts at Amherst have both been extremely helpful in reading the ma­ terial and proffering many valuable suggestions. We also wish to thank an anonymous referee for Springer Verlag, for his critical reading and comments. Naturally, we take full responsibility for whatever errors and shortcomings remain. OUr thanks go to Haifa University, particularly the mem­ bers of the Haifa University Computation Center, for their patience and help in the preparation of the manuscript and production of camera copy. It is a pleasure to acknowledge the assistance of various members of staff of the University of New South Wales, and in particular those at the computer facility within the School of Mathematics. Ian Boyd, Sydney, Austral ia John Blatt, Haifa, Israel. Table of Contents Preface . . . . . . . . . . . . . . . . . . . . . . . . v CHAPTER 1. INTRODUCTION AND BRIEF SUMMARY. . . . . . 1 THE TRADE CYCLE. 7 CHAPTER 11. A BRIEF HISTORICAL SURVEY OF Section A: Why the nineteenth century? • • • • • • • • • 7 Section B: Classification of Cycles. • • •• 10 11 Section C: The Crash of 1873. ••• •• Section D: Asymmetry between Rise and Fall. •• 15 Section E: The Speed of the Crash. 17 · . . . .

Inhaltsverzeichnis

Frontmatter

Chapter I. Introduction and Brief Summary

Abstract
The literature on trade cycles is already enormous, and grows all the time. It is therefore necessary to motivate yet another approach to this well worked area of economics.
Ian Boyd, John M. Blatt

Chapter II. A Brief Historical Survey of the Trade Cycle

Abstract
In this chapter we introduce what we consider to be the essential features of the observed trade cycle. We start by explaining our reasons for concentrating on the mid-nineteenth century; though we do, on appropriate occasions, include evidence from other periods. Then we examine the conventional classification of cycles, to establish the particular type of cycle (the major cycle) which interests us. We go on to describe, in some detail, the observed features of a particular, but we believe a typical, nineteenth century crash. Finally we extract, from this information, the two main characteristics of observed cycles which we consider to be of outstanding theoretical importance: (1) The asymmetry between slow rise and fast fall; and (2) The sheer speed of the “crash” phase.
Ian Boyd, John M. Blatt

Chapter III. Literature on Confidence

Abstract
In this chapter we present an abbreviated literature survey on the importance of confidence and its fluctuations. [1] We intend to show that many economic observers contemporary with the period, as well as later ones, were extremely conscious of the importance of this factor.
Ian Boyd, John M. Blatt

Chapter IV. The Dominant Theories

Abstract
This chapter is addressed to the main modern theories of the trade cycle, showing that these theories, which are couched in purely “real” terms, do not fit the facts. In the case of the most widely accepted theory, that the economy is fundamentally stable but subject to random shocks, we go into some statistical and mathematical detail.
Ian Boyd, John M. Blatt

Chapter V. A First Look at the New Model

Abstract
In this chapter we outline, in broad strokes, a schematic trade cycle model based on confidence and its fluctuations, and we support the basic points with evidence from economic history.
Ian Boyd, John M. Blatt

Chapter VI. Confidence

Abstract
In the previous chapters we showed that a psychological variable representing investor confidence must be an essential element in a theoretical approach to the trade cycle. Before embarking on the construction of a schematic model of the cycle along these lines, a preliminary study of confidence, uncertainty and investment evaluation is essential.
Ian Boyd, John M. Blatt

Chapter VII. Description of the Model

Abstract
In this chapter we will complete the description of our model, and exhibit some typical simulations. This model represents our view of the essential causation of the business cycle.
Ian Boyd, John M. Blatt

Chapter VIII. The Longer Run

Abstract
In this chapter, we shall investigate, to the extent that it is possible to do so with our highly simplified model, what happens over the longer run, that is, over a succession of cycles rather than just during one cycle.
Ian Boyd, John M. Blatt

Chapter IX. Some General Remarks

Abstract
Let us ask what economic function, if any, was performed by this continuing series of violent oscillations of the economic system of the nineteenth century. One might think (and many people, then and now, do think) that it should be much better to have a smoother-running system, not subject to such dreadful cataclysms every nine or ten years.
Ian Boyd, John M. Blatt

Backmatter

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