A Note on the “Unique” Business Cycle in the Keynesian Theory

Abstract

In this paper, we explore the existence and “uniqueness” of a limit cycle in the Keynesian theory. In a model with the simplest (linear) Keynesian consumption function and the logistic investment function based upon the profit principle, we establish the existence of a periodic orbit (irrespective of the speed of quantity adjustment) and, with the help of the theory on generalized Lienard systems, verify the uniqueness of it for the case in which the speed of quantity adjustment is large enough.