Multistability and role of noninvertibility in a discrete-time business cycle model

We study a discrete-time business cycle model in income and capital, a Kaldor-type model, in order to discuss the problem of coexistence of attractors and the related problem of basins of attraction. The model considered is particularly useful for pedagogical purposes because economically meaningful ranges of parameters exist such that an attractor characterized by oscillatory motion (which may be periodic, quasi-periodic or chaotic) coexists with two stable steady states, and consequently the choice of the initial conditions is crucial to decide if economic fluctuations are obtained or not in the long run.