Individual and market inertia in Luigi Amoroso’s cycle model

Luigi Amoroso was an Italian economist-mathematician, mainly known for his attempts to develop the Vilfredo Pareto’s general economic equilibrium scheme along dynamic lines. In addition, he worked out a cycle model, anchoring it to the economic interpretation of a concept inherited from classical mechanics, the inertia principle. He demonstrated that both the individual and aggregate behaviour of agents must be considered from an adaptive view once inertia is taken into account. Particularly, if behavioural variables, like habits, play a role in explaining individual decisions, phenomena such as euphoria and sluggishness become significant when considering an aggregate or market dimension.