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Show HN: A central bank simulator game with a realistic economic model

benoitessiambre.com

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Re: Show HN: A central bank simulator game with a realistic economic model

#241

Post by yobbo »

jsjohnst wrote: post #91

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?

The game has no relation to reality, but also remember that economic theory is only a rough description of what "seemed to make sense" at some point.

Re: Show HN: A central bank simulator game with a realistic economic model

#242

Post by BenoitEssiambre »

leononame wrote: post #160
reilly3000 wrote: post #137

After a rather dismal first couple of runs I read the blog post for some hints. The best I found was to try to raise rates during the good times so there is wiggle room during downturns. I was able to get 443,904 by raising to over 10% during the initial prosperity period and was able to cut rates in half as soon as there was a crash. Ultimately I stabilized at around 3.5%. As of the time of this post I think that is…

At first, it looked to me like you could barely influence the economy. But a couple of runs later, I found wildly different results (e.g. having hyperinflation and huge economic crisis) depending on what I'd do. Since the income from the central bank's interest is paid out to the people (and vice versa, negative interest will be passed as debt), the challenge seems like finding the correct ratio to increase GDP: infl…

If you keep inflation low and steady you can get higher scores from reducing menu costs. I can get around 446k by trying to keep it around 1%. Note that it gets more difficult to keep steady when you keep it lower.

Re: Show HN: A central bank simulator game with a realistic economic model

#243

Post by BenoitEssiambre »

eru wrote: post #173
leononame wrote: post #160

Earlier quoted context omitted.

At first, it looked to me like you could barely influence the economy. But a couple of runs later, I found wildly different results (e.g. having hyperinflation and huge economic crisis) depending on what I'd do. Since the income from the central bank's interest is paid out to the people (and vice versa, negative interest will be passed as debt), the challenge seems like finding the correct ratio to increase GDP: infl…

The model they use in the simulation is a bit weird. In reality, keeping a steady nominal GDP is a good idea. In fact, adopting a nominal GDP level target will make the market help you keep things steady. (By anticipating your central bank actions.)

I did include a graph of production in "coins worth per month" for those who would like to try to stabilize NGDP.

Re: Show HN: A central bank simulator game with a realistic economic model

#245

Post by [deleted] »

TheSpiceIsLife wrote: post #159
vanjajaja1 wrote: post #86

Earlier quoted context omitted.

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.

But, aren't finical systems a sociological science, rather than a mathematical model? In economies, people, politics, and their dispositions, their sentiments , dominate. How do you model human responses to local, national, regional, and global events. How do you model human cascades ?

[deleted]

Re: Show HN: A central bank simulator game with a realistic economic model

#246

Post by moomin »

reilly3000 wrote: post #137

After a rather dismal first couple of runs I read the blog post for some hints. The best I found was to try to raise rates during the good times so there is wiggle room during downturns. I was able to get 443,904 by raising to over 10% during the initial prosperity period and was able to cut rates in half as soon as there was a crash. Ultimately I stabilized at around 3.5%. As of the time of this post I think that is…

Given that I used a rather different strategy (typically 0, 4% in good times, slowly cutting back and running at -0.5 later in the game) and got 443419 maybe the lesson of the this is that central bank policy doesn't make as big a difference as we think?

Re: Show HN: A central bank simulator game with a realistic economic model

#247

Post by sschueller »

fartcannon wrote: post #109
OJFord wrote: post #61

Earlier quoted context omitted.

Similarly I immediately lowered to -0.25% and left it there, really quite stable and climbed gradually (not monotically, but close) to 442370. I assume it needs a bit of a tweak for negative inflations, or is limited by the events being fixed - 'people spend 12% less' is more likely to happen at higher interest rates for example. And in particular if we weren't leaving it fixed but had only just lowered it, (i.e. inc…

Isn't a negative interest rate basically UBI?

No, we have a negative interest rate in Switzerland and for the average person it basically means over a certain amount of cash in the bank they will take some. So kind of like a bank account fee.

Re: Show HN: A central bank simulator game with a realistic economic model

#248

Post by belter »

Oberbaumbrucke wrote: post #229
reilly3000 wrote: post #137

After a rather dismal first couple of runs I read the blog post for some hints. The best I found was to try to raise rates during the good times so there is wiggle room during downturns. I was able to get 443,904 by raising to over 10% during the initial prosperity period and was able to cut rates in half as soon as there was a crash. Ultimately I stabilized at around 3.5%. As of the time of this post I think that is…

With your first comment you are already more qualified than most current CB Governors. This current crisis has most Developed Markets going into it at 0% The best I found was to try to raise rates during the good times so there is wiggle room during downturns.

It's well known, that understanding how the economy works, was never a requirement for CB Governor:

"Nobody Really Knows How the Economy Works. A Fed Paper Is the Latest Sign": https://www.nytimes.com/2021/10/01/upshot/inflation-economy-...

Greenspan: There was a "flaw in the model of how I perceived the world works.": https://www.propublica.org/article/greenspan-says-i-still-do...

"Greenspan Says I Still Dont Fully Understand What Happened": https://youtu.be/R5lZPWNFizQ

Re: Show HN: A central bank simulator game with a realistic economic model

#249

Post by dwighttk »

moomin wrote: post #246
reilly3000 wrote: post #137

After a rather dismal first couple of runs I read the blog post for some hints. The best I found was to try to raise rates during the good times so there is wiggle room during downturns. I was able to get 443,904 by raising to over 10% during the initial prosperity period and was able to cut rates in half as soon as there was a crash. Ultimately I stabilized at around 3.5%. As of the time of this post I think that is…

Given that I used a rather different strategy (typically 0, 4% in good times, slowly cutting back and running at -0.5 later in the game) and got 443419 maybe the lesson of the this is that central bank policy doesn't make as big a difference as we think?

Has anyone gotten less than 400K?

Heck, less than 440K?

Re: Show HN: A central bank simulator game with a realistic economic model

#250

Post by MonkeyClub »

reilly3000 wrote: post #137

After a rather dismal first couple of runs I read the blog post for some hints. The best I found was to try to raise rates during the good times so there is wiggle room during downturns. I was able to get 443,904 by raising to over 10% during the initial prosperity period and was able to cut rates in half as soon as there was a crash. Ultimately I stabilized at around 3.5%. As of the time of this post I think that is…

I ran it four times, with four different starting interest rates, that never changed throughout the 240 months.

The best run was the 0% one: 442670.

All results:

2%: 238773

0%: 442670

50%: 21106 (early crash)

4%: 255726

Edit: Forgot to note that, while the other runs got the +12% iMac trees and the -12% drought/disaster events, the 0% run also got a -10% "loss of faith in the market" event thrown at it as well.

So, 0% interest rates and 0 banker interference is good enough in the SimCB model, and can normalize its way through random negative events too.

Anyone else with results from other constant interest rates?

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