Hi,

Consider two equilibrium points in the state space of an economic system, for simplicity suppose two pairs of E1(y1, p1) and E2(y2, p2) indicating yield and price in these two points.

Now assume that a shock into the system disturbs it in its first equilibrium and forces the states to change equilibrium into the second. Although both points may be considered of good (acceptable) characteristics, the path to transit from E1 to E2 is very important. Can the system (regarding all its elements, such as firms, people, etc.) tolerate whatever happens for the variables (e.g. prices, justice, purchasing power, etc.)?

So, modeling of the system with regards to its dynamic behavior is effective in designing parameters/inputs/controls/policies applied to the system in a manner that cause less fluctuations/overshoot, smoothly pass the transition states (both smooth and as fast as possible) and less harm the agents involved the changes.

Hope this was helpful.   

Thank you Hamed...great answer...

I think you will find it very difficult to get these models to work if there is an appreciably large number of variables.

Best of luck!

You can have a look on 2 papers are (i) Econographicology and (ii) Beyond the ceteris paribus assumption: modeling demand and supply assuming omnia mobilis. I find is possible to modeling 2 equilibriums by using multidimensional coordinate spaces.

See "Dynamic Economics" by Ronald Shone, for some simple examples in both micro and macroeconomic systems. 

Thank you...

Sorry, the book is: Economic Dynamics.

Dear Hamed:

I read this book today... thank you so much... look great this book... Thank you... Actually, I publish two papers in year 2008 and 2011 that I propose a new multidimensional graphical modelinhg to study the Dynamic Imbalance State (DIS).  

There is a very interesting topics

moving from static to dynamic models, published at: 

www.mpsge.org/papers/newmove.pdf

and you may find also here:

www.ivm.vu.nl/en/.../M2_tcm53-161549.pdf

Thank you Hisham

Indeed the topic is not a new one. See books and papers by MASANAO AOKI for instance. There is also a journal entitled  Journal of Economic Dynamics and Control.

You can see that there are many related problems raised and solved during more than 4 decades in this area.

I almost agree with you...Nobody propose an innovative idea to explain graphically the idea of dynamic imbalance state from a multidimensional perspective

Actually, the economic modeling of Imbalance State is nothing new. My idea is to replace the uses of 2-Dimensional graphs by using MD-Coordinate spaces that cann give us a better and general picture about the Dynamic Imbalance State (DIS), where we can use a large number of variables.