Economic Oscillations in a Multi-Country Growth Model with Free Trade and Tourism

Özet

This paper introduces exogenous time-dependent shocks to the multi-country growth model with tourism proposed by Zhang (2015). This study generalizes the model by making all the time-dependent parameters as time-dependent parameters. The model examines dynamic interactions among economic growth, structural change, international trade and tourist flows. It introduces endogenous tourism within a general dynamic equilibrium framework. The model integrates the three well-known Solow growth model, Oniki-Uzawa trade model, and the Uzawa two-sector model, and introduces tourist flows between national economies. We simulate the model to demonstrate existence of equilibrium points, motion of the dynamic system, and oscillations due to different exogenous shocks.