Eur. Phys. J. B 70, 567-573 (2009)
https://doi.org/10.1140/epjb/e2009-00243-y

Boom and bust in continuous time evolving economic model

SUPA, School of Physics, The University of Edinburgh, Mayfield Road, Edinburgh, EH9 3JZ, UK

Corresponding author: ^a lawrence.mitchell@ed.ac.uk

Received: 25 January 2008
Revised: 28 May 2009
Published online: 15 July 2009

Abstract

We show that a simple model of a spatially resolved evolving economic system, which has a steady state under simultaneous updating, shows stable oscillations in price when updated asynchronously. The oscillations arise from a gradual decline of the mean price due to competition among sellers competing for the same resource. This lowers profitability and hence population but is followed by a sharp rise as speculative sellers invade the large un-inhabited areas. This cycle then begins again.