Then, the questions arise: Is the Ghanaian Financial System in Crisis? This study was conducted to find answers to these problems unsolved with prior literature. There has been rampant fold-ups, merger and acquisitions occurring in the Ghanaian banking industry. The model replicates the upward instability and abrupt crises of Minsky's theory. The paper reports (1) eigenvalues for the linear parts of both the simplified analytical model and a numerical example of the more-SFC model, (2) a phase diagram for the analytical model, and, (3) analytical stability conditions for the more-SFC model.
The paper analyzes the dynamics of a simplified version of the main model and a more-SFC model with feedbacks from debt to borrowing and capacity utilization via debt-service effects. A section sketches a nonlinear mechanism that can bound the system. The paper shows it can be stated in three equations in the jump differentials and the usual differentials. Formally, the model comprises three ordinary differential equations and a compound Poisson process, with jumps drawn from a heavy-tailed stable distribution. The paper treats as endogenous the instantaneous probability of a jump and the size distribution of jump vectors. The model is based on self-reinforcing borrowing and output dynamics that repeatedly come to a sudden stop, with discontinuous downward jumps in the three variables. The model includes private-sector borrowing, capacity utilization, and the stock of private-sector debt. Minsky's theory of financial instability. This paper proposes a formalization of Hyman P.
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