Dynamic Equilibrium Models

Dynamic equilibrium models describe systems where two or more processes occur simultaneously but balance each other over time, maintaining a steady state. In these models, changes happen continuously but offset each other, resulting in no overall shift in the system’s condition. Think of it like a supply and demand balance in a market: as demand increases, supply adjusts to meet it, keeping prices stable. These models are used in various fields to understand how systems self-regulate amid ongoing changes, ensuring stability through ongoing, interconnected processes.