Paper Title :The Differential and Delay Differential Approach in the Analysis of Stable State Equilibrium Prices using Characteristic Equation Techniques

Author :Martin Anokye, Henry Amankwah, Emmanuel Kwame Essel, Irene Kafui Amponsah

Article Citation :Martin Anokye ,Henry Amankwah ,Emmanuel Kwame Essel ,Irene Kafui Amponsah , (2018 ) " The Differential and Delay Differential Approach in the Analysis of Stable State Equilibrium Prices using Characteristic Equation Techniques " , International Journal of Management and Applied Science (IJMAS) , pp. 89-93, Volume-4,Issue-7

Abstract : The study compares the stability states of price adjustment differential models with and without delay parameter using roots of characteristic equations. The states of stability of both models were simulated using their particular solutions with inputs from same source. It was found that irrespective of initial prices set for the commodity, the current price for the differential models will always have the propensity to move monotonically to the equilibrium price defined for the system. On the other hand, the current price for the delay- differential models tends to oscillate and move away from the initial prices due to the delay associated with the supply, then with time decreases and turns towards to the defined system equilibrium prices. It was deduced that whilst the current prices in the delay-differential models are not predictable at the initial stages due to the time delay parameters associated with them, its counterpart without the delay are predictable, since differential models converge monotonically to the equilibrium price points defined for the system. Since most economic and natural phenomena are associated with delays, it is recommended that such systems are modeled using delay-differential equations to reflect realities of the phenomena. Keywords - Stability Analysis, Delay Differential Equations, Differential Equations and Equilibrium Prices.

Type : Research paper

Published : Volume-4,Issue-7

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