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Persistent oscillations in a threshold adjustment model |
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| Authors: | Feichtinger Gustav Andreas J. Novak |
| Affiliation: | 1. Institute of Econometrics, Operations Research and Systems Analysis, Vienna University of Technology , AustriaArgent inierstra?e 8/119, A-1040 Vienna;2. Department of Statistics , Operations Research and Computer Science, University of Vienna , AustriaUniver-sitatsstraBe 5/9, A-1010 Vienna |
| Abstract: | In this paper we present a simple time-continuous behavioural model of habit formation. Addictive behaviour is damped by a threshold which adapts itself to the habit. This adaptive behaviour of the threshold may lead to periodic fluctuations of the consumption rate, the habit and the threshold. It turns out that both a low adjustment rate of the threshold as well as a steep consumption function favour oscillatory patterns. |
| Keywords: | Addiction Habit formation Limit cycles Nonlinear dynamical systems Threshold models |