Samuelson’s Multiplier Accelerator

This is a fairly direct implementation of the multiplier-accelerator model from Paul Samuelson’s classic 1939 paper,

“Interactions between the Multiplier Analysis and the Principle of Acceleration” PA Samuelson – The Review of Economics and Statistics, 1939 (paywalled on JSTOR, but if you register you can read a limited number of publications for free)

SamuelsonDiagramB

This is a nice example of very early economic dynamics analyses, and also demonstrates implementation of discrete time notation in Vensim.

See also:

The multiplier-accelerator model of business cycles interpreted from a system dynamics perspective. GW Low – Elements of the System Dynamics Method, 1980 – MIT Press: Cambridge, MA

Low, Gilbert W. The Principle of Conservation and the Multiplier-Accelerator Theory of Business Cycles. Proceedings of the 1976 System Dynamics Conference.

I’d love to have a copy of the Low model as a companion, if anyone is inclined to replicate it.

See my blog post for more description of the model.

Download for any version of Vensim:

SamuelsonMA-2014b.zip

2 thoughts on “Samuelson’s Multiplier Accelerator”

    1. Maybe weird, but not wrong, except to the extent that the whole model is wrong. What it implies is that the past value of C depends on (is a delay of) the present value of C.

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