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:
“We are told it will be of no use for us to ask this measure of justice—that the ballot be given to the women of our new possessions upon the same terms as to the men—because we shall not get it. It is not our business whether we are going to get it; our business is to make the demand.... Ask for the whole loaf and take what you can get.”
—Susan B. Anthony (1820–1906)
“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)
“To say that a man is vain means merely that he is pleased with the effect he produces on other people. A conceited man is satisfied with the effect he produces on himself.”
—Max Beerbohm (1872–1956)