ABSTRACT
The paper investigates a simple nonlinear dynamic model set by Ragnar Frisch in 1935 and never published until now. The model describes a simple economy with two agents, each producing one commodity and consuming the other’s one, and is designed to discuss whether capitalism is doomed to collapse or not. Although Frisch did neither solve nor simulate the behaviour of the system, he eventually understood that at least some very complicated dynamics emerged from it.
