Fashion and Business Cycles with Snobs and Bandwagoners in a Multi-Sector Growth Model

Wei-Bin Zhang

Abstract


This paper generalizes the dynamic growth model with interactions between fashion, economic growth and income and wealth distribution recently built by Zhang (2016). The modelling of fashion and preference change is inspirited by the economic model of fashion recently published by Giovinazzo and Naimzada (2015). This study introduces fashion into neoclassical growth theory. The original model is based on some ideas in the literature of economics of fashion. This study generalizes Zhang’s model by making all the time-independent parameters as time-dependent parameters. We simulate the motion of the economic system. We carry out comparative dynamic analysis with regard to periodic perturbations in some parameters. We show how exogenous period changes in these parameters lead to business cycles. 


Keywords


business cycles; fashion; snob and bandwagoner; neoclassical growth theory; income and wealth distribution

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References


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DOI: http://dx.doi.org/10.18533/job.v2i3.73

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Copyright (c) 2017 Wei-Bin Zhang

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This work is licensed under a Creative Commons Attribution 4.0 International License.

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.