ABSTRACT
After having analyzed some simple accelerator type models, the next obvious step is to enlarge the models and drop some of the simplifying assumptions in order to make the models more realistic. Linear dynamic econometric models will be studied in complete generality and Klein’s Model I (Klein, Economic Fluctuations in the United States) will be used as an example for purposes of exposition. This model was chosen as an example because it is relatively simple and because it possesses almost all the properties of the general linear dynamic economic model. Furthermore, Klein’s Model I is one of the best known of the simple models.
