Logistic Capital Management Theories and Theoretical Aspects of Economic Growth Cycle

Abstract

One of the most important characteristics of the economy is cyclicality -a periodic, regular short and long-term economic fluctuations. Cycle of economic growth -the sequential rise and fall variations of the main macroeconomic indicators, conditioned in appreciable activity changes in many types of economic activities. In the economic theory there are distinguished four stages of the economic growth cycle, passing one after the other -the peak, recession, crisis and boom differ from one another in the length of time, intensity, various macro-economic factors' impact to the economy and therefore never alike and regularly recurring. One of the newest approaches in economic growth theory, which deals with the limitations of economic growth and its causes -the logistic capital management theory created by Prof. S. Girdzijauskas (2006), which is based on the capital niche's, as the capital's growth space, concept of finality. The authors of the theory applied the definition of the classical "bubble" to the growth cycle and confirmed that in the cyclical economical fluctuations in some cases, forms a bubble effect whereas applying and introducing to it a fundamentally based output rate it is obtained an economic bubble phenomenon. The article deals with the theoretical aspects of logistic capital theory and the economic growth cycle. Purpose of the article -to review and compare the theoretical aspects and relationship between the logistic capital management theory and the economic growth cycle. Logistic capital management theory -is one of the newest approaches in the context of the economic activity's cyclical phenomena. In practice, this theory and suggested marginal capital growth models are not used for examining the economic growth cycle and the economic dynamics processes, an important point is that the logistic capital management theory and the new viewpoint of the authors -limited capital growth, clearly demonstrates that the capital as the country's GNP growth cannot be infinite and sooner or later it ends.