Economic Growth by Means of Interspecific Functional Response of Capital-Labour in Dynamical System

Abstract

Physical capital and labour force are two major factors of any economy, which play a key role in its growth. The association of these two components with each other is also a matter of study, which is carried out in this endeavour by means of an ecological system with Holling-type II function. The governing model is an avantgrade approach for economic theory as its equilibrium states and the stability analysis so obtained, referrer to different economic states with detail information about the capital-labour interaction. This novel assessment also contributes a significant way to scrutinize the capability of labours on consuming time on the capital and the efficiency of capital on processing output. Moreover, different patterns and cyclic behaviour of the Cobb-Douglas and constant-elasticity production functions, for different steady and oscillating states of the system are also provided comparatively. In addition, a numerical example is also discussed graphically with economic significance. These measurements will consequently keep the production cycle moving and so sustain the economic growth.