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...

Most recent theoretical research on endogenous economic growth has been conducted with continuous-time models that embody the assumption of an intertemporally optimizing representative agent. Yet virtually none of these models has been confronted with empirical data. In this paper we make use of...

The interest of economists in chaos theory started in the 1980s. The first to draw the attention of economists to chaos theory was, in fact, Brock (1986), who examined the quarterly US real GNP data 1947-1985 using the Grassberger-Procaccia correlation dimension and Lyapunov exponents....

Chaotic exchange rate models are structural models built in discrete time (difference equations), and show that with orthodox assumptions (PPP, interest parity, etc) and introducing plausible nonlinearities in the dynamic equations, it is possible to obtain a model capable of giving rise to...

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...