Certainly there are some economic shocks that are unpredictable. However,
that also seems to me to be a cop-out -- we need to acknowledge the fact
that thus far economic forecasting simply doesn't do much good: it has
little predictive power even in the short-run.
My hope for agent-based modeling is that it can model existing situations
and be able to predict future ones. Unfortunately I think we're still in
the infancy of this field and don't know much about this yet.
On the "black swans" point, note that there are predictable-unpredictable
events in many fields. For example in epidemiology, no one knows when the
next real pandemic will strike. But the models of spread and containment
are fairly well understood, at least to the level of being able to predict
the course of such an event when one does happen. We don't have that level
of sophistication in economic policy prediction, AFAIK, and we can't just
say it's because these events are inherently unpredictable. We can, and I
hope as time goes on will, do a much better job of being able to predict the
real-world impact of policy decisions. We're just there yet. Heck, we can
barely admit there's a solvable problem!
Mike Sellers
> -----Original Message-----
> From: News and discussion about computer simulation in the
> social sciences [mailto:[log in to unmask]] On Behalf Of
> Pablo Martí Federico
> Sent: Tuesday, June 09, 2009 12:28 PM
> To: [log in to unmask]
> Subject: Re: [SIMSOC] what is the point?
>
> I think that no economic model can predict a change in the
> trend due to the nature of the shocks. They are black swans.
> However, simulation models can potentially determine the
> probability of its occurrence which can be very useful for
> the assessment of economic policies.
> It is not perfect but pretty good.
>
>
> Federico Pablo-Martí
> Dpto. de Estadística, Estructura Económica y OEI Universidad de Alcalá
>
> Facultad de CC. Económicas y Empresariales Plaza de la Victoria, 3
> 28802 Alcalá de Henares, Madrid (SPAIN)
> Tlfno.: +34 918854231
> Fax: +34 918854201
> mail: [log in to unmask]
>
>
> -----Mensaje original-----
> De: News and discussion about computer simulation in the
> social sciences [mailto:[log in to unmask]] En nombre de
> Scott Moss Enviado el: martes, 09 de junio de 2009 12:40
> Para: [log in to unmask]
> Asunto: [SIMSOC] what is the point?
>
> A little while ago, I asked on this list if anyone knew of a
> correct, model-based forecast of the impact of any social
> policy. The response, once misunderstandings were sorted
> out, was several accounts of reasons why policy impacts could
> not be forecast. The criteria I suggested for deeming a
> forecast to be correct was the correct forecast of the timing
> and direction of change of specified indicators.
>
> We already know that economic recessions and recoveries have
> probably never been forecast correctly -- at least no
> counter-examples have been offered. Similarly, no financial
> market crashes or recoveries or significant shifts in market
> shares have ever, as far as we know, been forecast correctly
> in real time.
>
> I believe that social simulation modelling is useful for
> reasons I have been exploring in publications for a number of
> years. But I also recognise that my beliefs are not widely held.
>
> So I would be interested to know why other modellers think
> that modelling is useful or, if not useful, why they do it.
>
>
> --
> Professor Scott Moss
> Centre for Policy Modelling (retired)
>
> t: +44 (0)1663 750913
> m: +44 (0)776 968 9991
|