The Economy as an Evolutionary Pulsator

  • Richard M. Goodwin


In economics we commonly have models in search of facts — by contrast, long waves appear to be facts in search of a model. I would like to offer a prospective model. Generally, the shorter the period, the easier it is to explain why a cycle may exist: the best theory is that of the pig cycles, with a period of two lags. Then there is the stocks cycle, the best understood of all generalized economic oscillators. The longer waves of 5–15 years are less evident and have a less agreed-on explanation. Cycles of 40–50 years are difficult to establish and more difficult to explain. To begin with, the 200 or so years of industrial capitalism are too short a time to establish the existence of a cycle from highly disturbed statistical series, so that we do not even know whether there is anything to explain. Second, if a cycle does exist, it is difficult to find a mechanism that remains unchanged for that long a time to produce a cycle. The pronounced turbulence of modern capitalism makes it more or less impossible to determine any constant system parameters.


Real Wage Dynamical Coupling Excess Capacity Major Innovation Industrial Capitalism 
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  1. Goodwin, R.M. (1946), Innovations and the irregularity of economic cycles, Review of Economic Statistics, 28 (May), 95–104.CrossRefGoogle Scholar
  2. Goodwin, R.M. (1947), Dynamical coupling with special reference to markets having production lags, Econometrica, 15 (July), 181–204.CrossRefGoogle Scholar

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© Springer-Verlag Berlin Heidelberg 1987

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  • Richard M. Goodwin

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