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442,306 by just immediately setting interest at -0.5% and leaving it there entire time. Inflation varied widely, but seemed to correct itself around 12% and -4% and spent a lot of time near 0%.
Can anyone explain an economic theory why that happened, or is the game not reflective of reality?
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Historically 90% of families will lose their wealth within 3 generations. How does that jive with "people will save too much" when it seems rather intuitive monetary policy has nothing to do with how a grandkid who has never worked a day in their life, spends money?
> Historically 90% of families will lose their wealth within 3 generations. Wait, that's really interesting! Where did you read that?
Apparently this has been the case for long enough that there's even an old Chinese proverb
> Wealth does not pass three generations
Another great article into central bank-caused recession is Rothbard's "Economic Depressions: Their Cause and Cure". It had explanation for phenomenas such as why the food sector is not as impacted, during the bust, as some other highly technological, heavy industry sector.
For a more visual concepts, I find Mike Maloney's Hidden Secrets of Money pretty good, although it's not as rigorous as the previous sources.
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Thank you so much! I've similarly been trying to wrap my head around monetary things recently, and as with learning anything in physics (my field), I believe you don't really understand a model unless you can code up a simulator. It's been maddening not being able to find a comprehensive model of how all the bits fit together, and I have many times wondered if the lack of existence of a game like yours meant that no…
I've been looking for something similar too, an explanation of the financial system written out in code so that I can try understand it.
I recommend reading "Human Action" by von Mises. It explains a lot of economic concept including central banks and money. Eg. on why any amount of money is always sufficient for any society (assuming it has at least enough precision for the basic needs of the agents). This ofc is the opposite of what the game was based on. Another great article into central bank-caused recession is Rothbard's "Economic Depressions: T…
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That would result in an economy with huge deflation: People consuming the bare minimum of apples needed for survival because their gold savings would appreciate each year in value.
People are still gonna want the new iphone and latest suv. Having a hard money as the reserve currency doesn’t undermine the economy, quite the opposite.
This game needs a "gold standard" mode to see what happens to the toy economy with no central bank! EDIT: It would also be nice if the game paused around major events to give you more time to think & adjust. I found that the economy went off the rails if you don't react right away.
That would result in an economy with huge deflation: People consuming the bare minimum of apples needed for survival because their gold savings would appreciate each year in value.
442,329 by controlling interest to keep inflation as close to 1.5% as I could (which isn’t always easy). 442,306 by just immediately setting interest at -0.5% and leaving it there entire time. Inflation varied widely, but seemed to correct itself around 12% and -4% and spent a lot of time near 0%. Can anyone explain an economic theory why that happened, or is the game not reflective of reality?
Earlier quoted context omitted.
> Historically 90% of families will lose their wealth within 3 generations. Wait, that's really interesting! Where did you read that?
I don't know where I first read it, but here's an article talking about it https://www.nasdaq.com/articles/generational-wealth%3A-why-d... Apparently this has been the case for long enough that there's even an old Chinese proverb > Wealth does not pass three generations
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[0]: https://www.fa-mag.com/news/how-to-stay-rich-in-europe--inhe...
I made this game in order to try to wrap my head around central banks, inflation and macroeconomics, in order to get a better understanding of the aftermath of the global financial crisis and the current period of high inflation. Here is a blog post that goes into further details: https://benoitessiambre.com/simcb.html
But, and it pains me to say it, as someone with a bit of a background in economics, I dunno if realistic is quite the word i would use for your current model.
And I don't mean in a "all models are wrong but some are useful" kinda way. I think some of the limitations and simplifications might take away from the value of the model. I'd urge everyone to read the blog post to understand what's going on.
you've touched upon a lot of the apparent findings and paradoxes of macro, which is great.
to try to be constructive, I guess I would ask a rhetorical question to focus on a central (pun intended) issue: how are interest rates set by the central bank implemented? is it an independent variable that you kinda change, or is it implemented through changes in monetary + credit supply? I'm concerned that this is another one of those macroeconomic paradoxes built into the model that lessens its applicability: the idea that interest rates are a variable that the central bank issues by decree, as opposed to a rate that they target by adjusting other monetary/ policy settings?
anyway, good job. I love it when people actually code up and stimulate models :)