The Memory Concepts of Hysteretic Systems in Post-Keynesian Economics

Conceptualization of Historical Time in Post Keynesian Economics

“…As for the second goal, we extended our previous criticisms towards Setterfield's (1995Setterfield's ( , 1996Setterfield's ( , 1998aSetterfield's ( , 2008) chaotic terminology, which we provided in Chytil, Máslo (2014 by suggesting a definition of general reversibility as such a case when a shock -countershock sequence 1) results in the final configuration of the current, short-run and long-run value being equal to the initial configuration and 2) may be accompanied by the shortrun equilibrium path-dependence (but it does not have to). According to our terminology, general reversibility (in opposition to Setterfield, 2008) includes super-reversibility as a special case that we characterize as such a case when a shock -counter-shock sequence 1) results in the final configuration of the current, short-run and long-run value being equal to the initial configuration and 2) is accompanied by absence of path-dependence in the short-run equilibrium (so, for example the cases of unit-root hysteresis and persistence).…”

“…In our analysis of system (ir)reversibility, we draw upon Setterfield (2008), primarily. However, Setterfield's terminology in Setterfield (2008) but also in Setterfield (1995Setterfield ( , 1996Setterfield ( , 1998a) is in a desperately chaotic state which we already criticized in Chytil, Máslo (2014. The problem of Setterfield's terminological apparatus is absence of any kind of reflection of the above mentioned distinction between direct and indirect shocks on the one hand, and between static and dynamic systems on the other hand.…”

“…The authors introduce a new notion that they call hysteretic persistence, which they see as essential because such a phenomenon as path-dependence in the short-run equilibrium cannot be described by the existing of notions of hysteresis and persistence. In the field of system (ir)reversibility, drawing upon their previous research (Chytil, Máslo, 2014, the authors introduce a new notion of general reversibility, which they justify on the account that such phenomena as a shock -countershock sequence in both hysteretic-persistent and hysteretic systems cannot be described by either of Setterfield's (2008) notions of super-reversibility and irreversibility. Questioning Setterfield's (1998bSetterfield's ( , 1995 only too general dichotomy of lower/higher level of historical time, the authors rather suggest a characterization of historical time based on 6 attributes of "high-level" historical time based on the criteria of path-(in)dependence of equilibrium and (ir)reversibility.…”

“…First, drawing upon our previous efforts in this direction made in Chytil, Máslo (2014, we want to provide a redefinition of the term "reversibility" to escape the inconsistencies and ambiguities resulting from terminology in Setterfield (2008). For this purpose, we will present our notion of general reversibility whereby we will reject the self-contradictory meaning of super-reversibility in Setterfield (2008) and, instead, redefine the latter as a special case of the former.…”