Lansing, Kevin J.; Guo, Jang-Ting - 2001
that exhibits local indeterminacy, we show that the introduction of a constant capital tax or subsidy can lead to various … equilibrium, while the true nonlinear model exhibits global indeterminacy. This result implies that stabilization policies … designed to suppress sunspot fluctuations near the steady state may not prevent sunspots, cycles, or chaos in regions away from …
