The authors show the application of optimal control techniques via Pontryagin maximum principle to a continuous-time macroeconometric model of the Italian economy. They illustrate the results and examine their economic implications, amongst which the possibility of obtaining a better...

In this paper we give a detailed exposition of the fifth version of our model of the Italian economy, which is specified as a set of 24 nonlinear stochastic differential equations. We first examine its qualitative properties (steady state solution, structural stability, etc.). We then present...

The effects of slight changes in the parameters on the characteristic roots of a model (sensitivity analysis) has great potential in econometrics.The author, after suggesting a criterion for giving empirical contents to the notion of "slight", shows how the application of sensitivity analysis to...

The current account-interest rate relationship has been extensively investigated, but always assuming that it is linear. In this paper we examine the linearity versus nonlinearity issue with reference to this relationship in 11 OECD countries, and find overwhelming evidence in favour of...

The introduction into economics of the Lotka-Volterra prey-predator equations to model cyclical phenomena is commonly attributed to Richard Goodwin (1965). In this paper we show that the Italian economist Giuseppe Palomba had used these equations much earlier (1939), and describe Palomba's model...

The aim of this paper is to develop a continuous time exchange rate model that allows for heterogeneity of the agents' beliefs, in order to explore non-linearities and possible chaotic behaviour. The theoretical model contains an intrinsic non-linearity that gives rise to a jerk differential...

Continuous-time econometric models (i.e., models specified as systems of stochastic differential equations) are by now well established both in theory and in practice. Several macroeconometric continuous-time models exist for various countries. Among these the Italian continuous-time model...

This paper is a step in the direction of a larger research project aimed at determining the long run equilibrium value of the euro/dollar real exchange rate. Given this value, one could then give a precise meaning to the notion of undervaluation or overvaluation of the euro, and calculate its...

This book deals with the financial side of international economics and covers all aspects of international finance. There are many books and articles by exponents of alternative points of view. I know of no other book that provides the scope, balance, objectivity and rigor of this book. the late...