Introduction

Methods and models of economic dynamics describe the motion of an economy, or some part thereof, through time. The basic concept in such models is usually that of a path or trajectory which describes the admissible states of economic change. Dynamic models may simply portray the economic trajectory itself, or they may simulate attempts to influence such a path. The period of mathematical economics was one in which economists borrowed methodologies from the physical sciences to develop a formal theory based largely on calculus, using total and partial derivatives and Lagrange multipliers to characterise maxima. A growing interest in mathematical tools for forecasting and prediction has also been evident. The overall breadth of integration has swelled considerably as the field searches for its own identity, but also draws on complementary advances in other scientific disciplines. The chapter also presents an overview of key concepts discussed in this book.