Work
Goodwin worked on the interaction between long run growth and business cycles. His article on "matrix multiplier" was one of the earliest uses of the Perron–Frobenius theorem in economics, although his reasoning had an error that was diagnosed by Frank H. Hahn. He returned to the Perron–Frobenius theorem with his book on The dynamics of a capitalist economy.
Goodwin adopted the Lotka–Volterra equations for the population dynamics of a predator and prey species as a persistent model of economic growth, called the "Goodwin model" (or "Goodwin's Class-Struggle Model"). In his model, employed workers have the role of predators, as their wage demands squeeze profits and hence investment, leading to an increase in unemployment. Another model, "Goodwin's Non-Linear Accelerator", is also a model of endogenous cycles in economic activity; the cycles do not rely on outside shocks or structurally unstable parameters. "A Growth Cycle" (1967) saw Goodwin utilise Volterra's equations to formalise Marx's theory of economic cycles.
Read more about this topic: Richard M. Goodwin
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