Business Cycles Vs. Acceleration Effect
As the acceleration effect dictates that the increase of income accelerates capital accumulation, and the decrease of income accelerates capital depletion (in a simple model), this might cause the system to become unstable or cyclical, and hence many kinds of business cycle models are of this kind (the multiplier-accelerator cycle models).
Read more about this topic: Accelerator Effect
Famous quotes containing the words business, cycles and/or effect:
“Reading is not a duty, and has consequently no business to be made disagreeable.”
—Augustine Birrell (1850–1933)
“The stars which shone over Babylon and the stable in Bethlehem still shine as brightly over the Empire State Building and your front yard today. They perform their cycles with the same mathematical precision, and they will continue to affect each thing on earth, including man, as long as the earth exists.”
—Linda Goodman (b. 1929)
“That when that knot’s untied that made us one,
I may seem thine, who in effect am none.
And if I see not half my dayes that’s due,
What nature would, God grant to yours and you;”
—Anne Bradstreet (c. 1612–1672)