Profitable inventory chaos in a macro disequilibrium dynamic model

This study discusses a possibility that chaotic fluctuations might be preferable to a steady state. For this purpose, it uses a simple macro disequilibrium model in which inventory can be chaotically fluctuated. In such a model, the profit of an inventory-holding firm fluctuates accordingly. This raises the question of its average profit in the long-run. This study analytically and numerically demonstrates that the long-run average profit of a chaotic trajectory can be greater than the profit resulting in the stationary state.