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Building an economy simulator from scratch

thomassimon.dev

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Re: Building an economy simulator from scratch

#211

Post by neilwilson »

lottin wrote: post #139
neilwilson wrote: post #131

" tax works by pooling a percent of sellers revenue." What the public servant actually does is impose a tribute on the workers in a denomination the public servant determines . If you don't provide the denomination then the public servant confiscates your assets by force. The population then offers their goods and services in return for the denomination the public servant issues . The public servant then determines t…

> That's the source of money, and the source of the price level. What do you mean?

"The state sets the terms of exchange for its currency with the prices it pays when it spends, and not per se by the quantity of currency that it spends. For example, if the state has an open-ended offer to hire soldiers at $50,000 per year, the price level as thereby defined will remain constant regardless of how many soldiers are hired and regardless of the state’s total spending. The state has set the value of its numeraire exogenously, providing that information of absolute value that market forces then utilize to allocate by price with exchange values of other goods and services determined in the marketplace. Without the state supplied information, however, there would be no expression of relative value in terms of that currency.

Should the state decide, for example, to increase the price it pays for its soldiers to $55,000 per year, it would be redefining the value of its currency downward and increasing the general price level by 10%, as market forces reflect that increase in the normal course of allocating by price and determining relative value. And for as long as the state continues to pay soldiers $55,000 per year, assuming constant relative values, the price level will remain unchanged. And, for example, the state would have to continually increase the rate of pay by 10% annually to support a continuous annual increase of the price level of 10%."

https://warrenmosler.com/aframeworkfortheanalysisofpriceandi...

Re: Building an economy simulator from scratch

#212

Post by sdfghswe »

econperplexed wrote: post #70
sdfghswe wrote: post #36

Earlier quoted context omitted.

> What I don't get is why there are no readily available online macroeconomic simulators with real world data that make these sort of predictions. Are you high or what? The problem is so complex that people don't even agree how to take a measurement , let alone how to simulate the system. If nowadays people disagree when looking at the same numbers, imagine if each one could point to the numbers in his own simulator.

Lets take a very particular variable. Every month or so, central/state banks in every country have a meeting to decide the policy rate. They look at some data and the output of some models, then wave some political magic wand over it and make a decision about which direction to move the rate. Then they make a statement like, "our decision will decrease inflation over the next three quarters by this much." The data th…

Ok fine. My strong reaction was really due to the use of the word "simulator".

But if you say model - yeah, central banks do that. I'm not really familiar how public their models are. I would bet you that they intentionally don't want people to know "here's the exact model and here's the exact inputs", because they want to keep some discretion for themselves. They want to be able say "I know that this model with these inputs says X, but as a thinking human being I know that the model doesn't account for Y which has been crucial in these past few months, and so instead of X we'll do Z".

What you said makes a lot of sense, but it would require collaboration from the decision makers. There's no incentive, I believe, for someone to do this "open source stye", because the moment that their effort pays off, some hedge fund will take it and use it to trade on it.

Re: Building an economy simulator from scratch

#213

Post by [deleted] »

mikhailfranco wrote: post #133
ch4s3 wrote: post #16

Earlier quoted context omitted.

> What I don't get is why there are no readily available online macroeconomic simulators with real world data that make these sort of predictions. You aren't the first person to have this thought. It just turns out to be incredibly difficult.

Sounds like we need wikiconomy crowd-sourced model building over two open-source platforms: - mathematical macro-economic simulation run by differential dependencies (like Minsky) - agent-based Monte-Carlo platform for behavioural experiments to find or validate the macro rules There would be a core set of models, with parametrized instances running for each country, loosely coupled through trade flows, capital flows…

[deleted]

Re: Building an economy simulator from scratch

#214

Post by ch4s3 »

mikhailfranco wrote: post #133
ch4s3 wrote: post #16

Earlier quoted context omitted.

> What I don't get is why there are no readily available online macroeconomic simulators with real world data that make these sort of predictions. You aren't the first person to have this thought. It just turns out to be incredibly difficult.

Sounds like we need wikiconomy crowd-sourced model building over two open-source platforms: - mathematical macro-economic simulation run by differential dependencies (like Minsky) - agent-based Monte-Carlo platform for behavioural experiments to find or validate the macro rules There would be a core set of models, with parametrized instances running for each country, loosely coupled through trade flows, capital flows…

My point is that tons of people have wanted to do this and tried and failed. There is too much to model and existing models don't have predictive power. Basically when calibrating the models there will multiple sets of parameters that fit past data and produce wildly different predictions. If you could devise a general macroeconomic model that made accurate predictions you could become ludicrously wealthy. Even accurately predicting corn prices 5 years out would net you considerable returns.

So many things that effect economic behavior just aren't really quantifiable. Even Keynes who was a proponent of modeling and economic planning acknowledged this[1]. Hayek talked about information being too decentralized and preferences arising organically, which made planning(modeling) imprecise and inefficient if not impossible[2].

[1] https://en.wikipedia.org/wiki/Animal_spirits_(Keynes)

[2] https://www.kysq.org/docs/Hayek_45.pdf

Re: Building an economy simulator from scratch

#216

Post by Ruddle »

Nezteb wrote: post #6

Is the source code for this simulator available anywhere? The post's code itself is minimized/obfuscated: https://thomassimon.dev/assets/cashloss.1fca21f6.js I couldn't find anything on the author's GitHub. I'm mostly just curious how it's built.

Author again, https://github.com/Ruddle/EconomySimulator
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