Chaotic Behaviour in a Simple Macroeconomic Model

  • David Chappell
Conference paper


A simple dynamic monetary model of a closed economy is proposed in which the Government uses money creation as a means of financing budget deficits. It is assumed that all money in the economy is Government fiat money which is costlessly produced and pays no interest and that real Government expenditure is a fixed proportion of real GNP.


  1. Wolf A (1986) Quantifying chaos with Lyapunov exponents. Chapter 13 of Holden A V (Ed) Chaos. Manchester University Press, Manchester.Google Scholar
  2. Chappell D and Peel D A (1979). On the dynamic stability of monetary models when the money supply is endogenous. The Manchester School, 47: 349–358.Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 1993

Authors and Affiliations

  • David Chappell
    • 1
  1. 1.Sheffield University Management SchoolSheffieldUK

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