A system-theoretic critique of dynamic economic models

  • R. E. Kalman
Conference paper
Part of the Lecture Notes in Control and Information Sciences book series (LNCIS, volume 19)


This paper treats the theoretical aspects of modeling and simulation of dynamical systems, especially those arising in economics.

Our aim is primarily methodological critique; while the ultimate arguments rest on advanced mathematical concepts, the conclusions are stated in quite elementary and intuitive terms.

There are important implications for the entire area of “modeling”.


Realization Theory Unmeasurable Variable System Aspect Seasonal Adjustment Monetarist Model 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

9. References

  1. R.J. BALL (editor) (1978) Report of the Committee on Policy Optimization, Her Majesty's Stationery Office, Cmnd. 7148, 117 pages.Google Scholar
  2. G.C. CHOW (1975) Analysis and control of dynamic economic systems, Wiley, 307 pages.Google Scholar
  3. W.M. CORDEN (1977) Inflation, exchange rates, and the economy, Clarendon Press, Oxford.Google Scholar
  4. W. FELLNER (1978) “Structural problems behind our measured unemployment rates”, in Contemporary Economic Problems 1978, edited by W. Fellner, American Enterprise Institute, Washington, DC, pages 83–112.Google Scholar
  5. M. HAZEWINKEL (1978) “On identification and geometry of the space of linear systems”, Econometric Institute, Erasmus University, Rotterdam, 15 pages (preprint).Google Scholar
  6. R.E. KALMAN (1956) “Nonlinear aspects of sampled-data control systems”, Proc. 2nd. Symp. on Nonlinear Circuit Theory, Polytechnic Institute of Bklyn., pp. 273–313.Google Scholar
  7. R.E. KALMAN “Physical and mathematical mechanisms of instability in nonlinear automatic control systems”, Trans. ASME, 79: 553–556.Google Scholar
  8. R.E. KALMAN (1968) “On the mathematics of model building”, in Neural Networks, edited by E. Caianiello, Springer, pp. 170–177.Google Scholar
  9. R.E. KALMAN (1971) “On minimal partial realizations of a linear input/output map”, in Aspects of Network and System Theory, edited by R.E. Kalman and N. DeClaris, Holt, Rinehart and Winston, pp. 385–408.Google Scholar
  10. R.E. KALMAN (1974) “Realization theory of linear dynamical systems”, in Control Theory and Functional Analysis, Vol. II, International Atomic Energy Agency, 1976, Vienna AUSTRIA, pp. 235–256.Google Scholar
  11. R.E. KALMAN (1978) “A retrospective after twenty years: from the pure to the applied”, in Applications of Kalman Filter to Hydrology, Hydraulics, and Water Resources, edited by Chao-Lin Chiu (Proc. of AGU Chapman Conference at the University of Pittsburgh, May (1978), Dept. of Civil Engineering, University of Pittsburgh.Google Scholar
  12. R.E. KALMAN (1979) “Parametric models in time series and dynamic identification”, in Developments in Statistics, edited by P.R. Krishnaiah, Academic Press.Google Scholar
  13. D.A. LIVESAY (1975) “A minimal realization of the Leontief dynamic input-output model”, Chapter 25 ofGoogle Scholar
  14. R.M. MAY (1976) “Simple mathematical models with very complicated dynamics”, Nature, 261: 459–467.CrossRefADSPubMedGoogle Scholar
  15. D.H. MEADOWS, D.L. MEADOWS, J. RANDERS, and W.W. BEHRENS (1972) The limits of growth, Potomac Associates-Universe Books, New York.Google Scholar
  16. P.A. SAMUELSON (1971) “Maximum principles in analytical economics” (Nobel lecture), Science, 173: 991–997.ADSCrossRefGoogle Scholar
  17. J. SHISKIN (1978) “Seasonal adjustment of the US unemployment rate”, Cambridge Time Series Conference, July 1978.Google Scholar
  18. E.D. SONTAG and Y. ROUCHALEAU (1976) “On discrete-time polynomial systems”, J. Nonlinear Analysis, 1: 55–64.MathSciNetCrossRefGoogle Scholar
  19. P.J. VERMEULEN and D.C.J. DE JONGH (1977) “Growth in a finite world — a comprehensive sensitivity analysis”, Automatica, 13: 77–84.CrossRefGoogle Scholar
  20. M. v. N. WHITMAN (1975) “Global monetarism and the monetary approach to the balance of payments”, Brookings Papers on Economic Activity, 1975 (3) 491–536.Google Scholar
  21. (1976) “International dependence and the US economy”, in AEI Studies in Contemporary Economic Problems 1976, edited by W. Fellner, American Enterprise Institute, Washington, DC, p. 183–223.Google Scholar

Copyright information

© Springer-Verlag 1979

Authors and Affiliations

  • R. E. Kalman
    • 1
    • 2
  1. 1.Swiss Federal Institute of TechnologyZürichSwitzerland
  2. 2.University of FloridaGainesvilleUSA

Personalised recommendations