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Title Page |
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Copyright Page |
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Contents |
7 |
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Preface |
10 |
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Copyright notices |
11 |
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Chapter 1 Why agent-based modelling is useful for economists |
13 |
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1.1 Introduction |
13 |
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1.2 A very brief history of economic modelling |
13 |
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Traditional macroeconomic models |
14 |
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Dynamic stochastic general equilibrium models |
14 |
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Complexity economics |
14 |
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The impact of the 2008 economic crisis |
15 |
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1.3 What is ABM? |
16 |
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1.4 The three themes of this book |
17 |
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Heterogeneity |
17 |
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Dynamics |
17 |
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Interactions |
18 |
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1.5 Details of chapters |
18 |
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Chapter 2: Starting agent-based modelling |
18 |
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Chapter 3: Heterogeneous demand |
18 |
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Chapter 4: Social demand |
19 |
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Chapter 5: Benefits of barter |
19 |
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Chapter 6: The market |
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Chapter 7: Labour market |
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Chapter 8: International trade |
20 |
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Chapter 9: Banking |
20 |
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Chapter 10: Tragedy of the commons |
20 |
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Chapter 11: Summary and conclusions |
20 |
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The models |
20 |
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References |
21 |
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Chapter 2 Starting agent-based modelling |
23 |
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2.1 Introduction |
23 |
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2.2 A simple market: the basic model |
24 |
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2.3 The basic framework |
25 |
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2.4 Enhancing the basic model: adding prices |
30 |
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2.5 Enhancing the model: selecting traders |
33 |
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2.6 Final enhancement: more economically rational agents |
35 |
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2.7 Running experiments |
37 |
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2.8 Discussion |
38 |
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Appendix 2.A The example model: full version |
39 |
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References |
40 |
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Chapter 3 Heterogeneous demand |
41 |
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3.1 Introduction |
41 |
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3.2 Modelling basic consumer demand theory |
42 |
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Distributing budgets |
44 |
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Giving preferences to households |
46 |
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3.3 Practical demand modelling |
51 |
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3.4 Discussion |
55 |
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Appendix 3.A How to do it |
58 |
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Budget distribution |
58 |
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Utility function-based demand model |
59 |
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Practical demand model |
60 |
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References |
64 |
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Chapter 4 Social demand |
65 |
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4.1 Introduction |
65 |
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4.2 Social networks |
65 |
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4.3 Threshold models |
68 |
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Infection models |
71 |
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Influence models |
71 |
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4.4 Adoption of innovative products |
74 |
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4.5 Case study: household adoption of fixed-line phones in Britain |
76 |
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Modelling demographic changes |
76 |
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Modelling income |
76 |
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An income-only model |
78 |
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Modelling network effects |
79 |
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4.6 Discussion |
82 |
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Appendix 4.A How to do it |
82 |
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Social circles model |
82 |
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Threshold model |
84 |
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Phone adoption model |
86 |
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References |
90 |
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Chapter 5 Benefits of barter |
92 |
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5.1 Introduction |
92 |
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5.2 One-to-one barter |
93 |
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The Edgeworth Box |
95 |
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Dynamics of the Edgeworth Box |
96 |
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5.3 Red Cross parcels |
100 |
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Introducing shortages |
106 |
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5.4 Discussion |
108 |
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Appendix 5.A How to do it |
109 |
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Edgeworth Box game |
109 |
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Edgeworth Box random model |
110 |
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Red Cross parcels model |
112 |
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References |
116 |
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Chapter 6 The market |
117 |
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6.1 Introduction |
117 |
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6.2 Cournot–Nash model |
117 |
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Introduction |
117 |
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The agent-based model |
118 |
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6.3 Market model |
120 |
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Introduction |
120 |
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Consumers |
124 |
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Shops |
125 |
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Results |
129 |
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6.4 Digital world model |
129 |
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Introduction |
129 |
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Sellers |
131 |
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Consumers |
132 |
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Results |
132 |
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6.5 Discussion |
136 |
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Appendix 6.A How to do it |
137 |
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The Cournot–Nash model |
137 |
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Shops model |
139 |
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Digital world model |
141 |
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References |
143 |
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Chapter 7 Labour market |
144 |
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7.1 Introduction |
144 |
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The labour force |
144 |
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Employers |
151 |
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Summary |
154 |
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7.2 A simple labour market model |
154 |
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Stage 1: Wages |
154 |
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Stage 2: Job search |
155 |
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Stage 3: The Guildford labour market |
160 |
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Results |
162 |
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7.3 Discussion |
163 |
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Appendix 7.A How to do it : |
167 |
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Wage distribution model |
167 |
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Things to try using the wage distribution model |
167 |
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Job search model |
169 |
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Things to try using the job search model |
169 |
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Guildford labour market model |
171 |
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References |
173 |
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Chapter 8 International trade |
175 |
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8.1 Introduction |
175 |
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Definition of exchange rates |
175 |
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Nominal exchange rates |
175 |
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Effective exchange rates |
176 |
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Real exchange rates |
177 |
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Purchasing power parity |
178 |
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Interest rate parity |
178 |
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Exchange rate regimes |
180 |
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The experience of the British pound, the US dollar and the euro |
182 |
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8.2 Models |
184 |
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Introduction |
184 |
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Assumptions |
185 |
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Inflation |
186 |
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Depreciation |
191 |
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Exogenous drop in demand for exports |
191 |
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Fiscal change |
194 |
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8.3 Discussion |
195 |
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Appendix 8.A How to do it |
197 |
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International trade model |
197 |
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References |
199 |
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Chapter 9 Banking |
201 |
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9.1 Introduction |
201 |
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Fractional reserve banking |
201 |
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Banking crises and the regulation of banks |
204 |
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A simple example |
208 |
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9.2 The banking model |
210 |
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A basic example |
210 |
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Introducing the capital adequacy ratio target |
214 |
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Affordability and different types of loans |
214 |
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Adding interest |
215 |
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A shock to the system |
216 |
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9.3 Discussion |
218 |
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Appendix 9.A How to do it |
221 |
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Banking model |
221 |
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Things to try |
222 |
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References |
224 |
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Chapter 10 Tragedy of the commons |
226 |
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10.1 Introduction |
226 |
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Economic analysis |
227 |
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10.2 Model |
230 |
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The carrying capacity of the meadow |
230 |
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Managing the meadow |
232 |
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10.3 Discussion |
237 |
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Appendix: 10.A How to do it: : |
240 |
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Carrying capacity model |
240 |
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Meadow management model |
242 |
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References |
244 |
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Chapter 11 Summary and conclusions |
246 |
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11.1 Introduction |
246 |
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11.2 The models |
246 |
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11.3 What makes a good model? |
249 |
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11.4 Pros and cons of ABM |
250 |
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References |
251 |
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Further reading and resources |
252 |
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Index |
254 |
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EULA |
259 |
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