Description of behavior of national economies in state space

This paper deals with analysis of behavior of national economies by using the total least squares method. National economies are described in state space of the following variables: gross domestic product, inflation, and unemployment. Their behavior is investigated by fitting their phase trajectories to plane. A possible method of description of the dynamical properties of national economies by differential equations is proposed. In conclusion the use of the investigated mathematical model for prediction and evaluation of the performance of national economies is discussed. A MATLAB routine for fitting 3D data to lines and planes in 3D is provided.