Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/264885 
Year of Publication: 
2022
Series/Report no.: 
BERG Working Paper Series No. 182
Publisher: 
Bamberg University, Bamberg Economic Research Group (BERG), Bamberg
Abstract: 
It takes time to produce commodities, and different production technologies may take different lengths of time. Suppose that firms may switch between different production technologies that take different lengths of time. A natural implication of such a scenario is that not all firms would then offer their commodities in every period, i.e. firms' total supply schedule would become a time-varying quantity. Based on a behavioral cobweb framework, we analytically demonstrate that commodity markets become unstable when firms switch too rapidly between production technologies that take different lengths of time. In particular, we observe that supply distortions lead to endogenous commodity price dynamics due to a mismatch between supply and demand.
Subjects: 
Cobweb models
production delays
endogenous price dynamics
bounded rationality and learning
nonlinear maps
stability and bifurcation analysis
JEL: 
D24
E32
Q11
ISBN: 
978-3-949224-03-4
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.