Stochastic Processes and Economic Evolution

  • Wei-Bin Zhang
Part of the Springer Series in Synergetics book series (SSSYN, volume 53)


We have shown that random economic behavior may occur in relatively very simple differential equations. Regular and irregular oscillations may be created endogenously by relatively simple interactions among economic variables. There is order in chaos. However, as we have explained before, there is another way to explain economic fluctuations. Dynamic systems which are subjected to external noise can exhibit irregular behavior. For instance, consider a simple example of a periodically driven (pendulum) equation (see Schuster 1988)
$$\frac{{{d^{2}}x}}{{{d^{2}}t}} + \frac{{rdx}}{{dt}} + \sin x = A\cos \left( {\omega t} \right),$$
, where r is the damping constant, A represents the amplitude and ω the frequency of a driving torque.


Lyapunov Exponent Hopf Bifurcation Master Equation Small Fluctuation External Noise 
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Copyright information

© Springer-Verlag Berlin Heidelberg 1991

Authors and Affiliations

  • Wei-Bin Zhang
    • 1
  1. 1.Institute for Futures StudiesStockholmSweden

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