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Nelson & Winter (1982) Model in Java


J.A. Schumpeter

Joseph A. Schumpeter, 1883-1950


This applet is an implementation of the basic industry dynamics model of Nelson & Winter(1982, part V). I developed it in order to permit to students to "play" with it and learn some basic evolutionary dynamics. At theoretical level, this applet shares naturally all the limitations of the initial model.

You can find a very quick description of the Nelson & Winter Model in this page.

Components of the applet

This applet is based on two classes:

Class documentation generated by javadoc.

I also use the Corejava package from the excellent book of same title:

Gary Cornell and Cay. S. Horstmann, 1997, "Core Java 1.1", SunSoft Press, 622 pages.

And the beautiful Graph package of Leigh Brookshaw.

The sources of this applet can now be read online:

Quick description

This applet uses the initialization procedure used in Nelson & Winter (1982):

The parameter table can be used to setup different elements of the model:

Important note:

All the values in the table must be integers. This is why some elements have their name followed by "%" symbol: For these fields, a given integer value will be divided by 100 in order to obtain a float.

Example: A value of 16 in "initial prod." box is converted to 0.16 by the program.

This constraint makes possible the use of some standard elements in CoreJava for checking of values given by the user.


You can observe four graphics which describe the evolution of the industry.

  1. Evolution of the market price in time ;
  2. Innovation and the diffusion of the technologies (the ratio of Average Productivity to Maximal Productivity) ;
  3. Herfindal concentration index for the allocation of capital in the industry (in equivalent firm number) ;
  4. Herfindal concentration index of market shares (in equivalent firm number).

This version is much faster and it is possible to study the long term evolution of the industry with many firms.

You must use a Java 1.5 compatible browser for running the model.

You can now run the model (new version)

Or play with the interactive version where you will control one of the firms

Class documentation generated by javadoc.

All comments are also welcome and will be greatly appreciated.

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Murat Yildizoglu's homepage

For a very good exposition of Nelson and Winter's models and their developments, see also Esben Sloth Andersen's Evolutionary economics page

© 1996-2007, Murat Yildizoglu. Last update: January 5, 2008, v.5.2
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