Read this article to learn about the concept, importance and limitations of the Samuelson and Super-Multiplier model of business cycle. Concept of the Models: Consumption and investment spending as determined by a certain set of relationship interact with each other to form the propelling force for aggregate change, which in turn, forms the basic explanatory variable for further changes in [...]
Read this article to learn about the Kaldor’s model of the trade cycle. Kaldor's theory of the trade cycle appeared in 1940 just four years after the publication of the General Theory in 1936. It is a comparatively simple and very neat theory built directly on Keynes' saving- investment analysis. Although Keynes did devote a lot in the General Theory [...]
Read this article to learn about the nine major limitations of Hick’s theory of trade cycle. (i) Some of the assumptions on which Hicks theory of trade cycle is based have been criticized severely. Firstly, the constant accelerator and multiplier as assumed in the model are not realistic. A constant accelerator means that the ratio of investment to an increase [...]