EC launches consultation on global systems science research

The European Commission (EC) has been an important funder of complexity economics, network science and other global systems science (GSS) research in economics and public policy.  The EC’s Future and Emerging Technologies (FET) programme has launched an online consultation to understand what the game-changing technologies of the next decades will be (see the press release).

The consultation targets scientists, researchers, innovators, entrepreneurs and members of civil society in general. The GSS consultation can be found here.

A large feedback of the GSS community will be of the essence to ensure a possible follow-up call for research funding in 2017. Everybody is invited to contribute.

Preventing accidents in complex systems

The financial industry needs to learn lessons from other complex systems such as petrochemical plants and space exploration in order to lessen the danger of accidents, according to leading economist John Kay.

Writing in the Financial Times, Kay points to the nuclear incident at Three Mile Island in the United States in 1979 that led to an inquiry that made recommendations that would ensure an identical failure could not recur.

However Kay, a visiting professor at the London School of Economics, says there will be other, different, accidents at other stations – as indeed there have been, mostly recently at the Fukushima plant in Japan in 2011.

He cites the work of Charles Perrow, emeritus professor of sociology at Yale University, who coined the term “normal accidents” to describe the similar incidents that inevitably occur in all the complex systems he observes: marine transport, petrochemical plants and space exploration.

Kay writes that two features render complex systems vulnerable to complexity: interactive complexity that means everything depends on everything else; and tight coupling which means that there is little slack to permit self-repair or recovery.

He says attempts to design a financial system for zero failure are “impractical”. Instead it should look “shorter, simpler, linear chains of intermediation…and loose coupling that gives every part of the system loss absorption capacity and resolution capability”.

However he says that the development of the financial industry over the last two decades has been in the opposite direction. Interactive complexity has increased through the “explosion of trading between financial institutions” while shorter timescales and a drive to more efficient use of capital have meant coupling between institutions has become tighter.

“Finance needs to learn from engineers with experience of complex systems in the face of ‘normal accidents’,” he concludes.

Meeting at Palermo

We had a great meeting in Palermo with the Macro Experts. I believe we had a fruitful discussion and it was a great step forward to the Mark 2 model in an exceptional city.

-Richard Legéndi

New Publication @ ECPAM conference

We have submitted the final version of our paper to the ECPAM conference.

Abstract This paper examines model replication in the context of agent-based simulation through two case studies. Replication of a computational model and validation of its results is an essential tool for scientific researchers, but it is rarely used by modelers. In our work we address the question of validating and verifying simulations in general, and summarize our experience in approaching different models through replication with different motivations. Two models are discussed in details. The first one is an agent-based spatial adaptation of a numerical model, while the second experiment addresses the exact replication of an existing economic model.

Find the details of the publication here.

–  Richard Legéndi

Crisis meeting @ London

We have just arrived to London to the Crisis Meeting held at the City University!

On the first sight, London is a beautiful historical city, hope we’ll have some time to have a short sightseeing 😉

The meeting will be quite interesting because we’ll have representatives from central banks and regulatory agencies and we’ll have the possibility to collaborate.

Agent-based Computational Economics Vol. 27, Issue2

The latest issue of “The Knowledge Engineering Review” journal is a special issue on the topic of Agent-based Computational Economics, guest-edited by Robert E. Marks and Nicolaas J. Vriend. The issue is volume 27, issue 2 (June 2012) and is available from here:

http://journals.cambridge.org/action/displayIssue?decade=2010&jid=KER&volumeId=27&issueId=02

The table of contents is copied below.


TABLE OF CONTENTS

The Knowledge Engineering Review, Volume 27, Issue 02, June 2012

The special issue: agent-based computational economics-overview
Robert E. Marks and Nicolaas J. Vriend
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 115-122

Analysis and synthesis: multi-agent systems in the social sciences
Robert E. Marks
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 123-136

Agent-based computational economics: a short introduction
Matteo G. Richiardi
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 137-149

Aggregation in agent-based models of economies
Scott E. Page
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 151-162

On the scientific status of economic policy: a tale of alternative paradigms
Giorgio Fagiolo and Andrea Roventini
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 163-185

Agent-based economic models and econometrics
Shu-Heng Chen and Chia-Ling Chang and Ye-Rong Du
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 187-219

Agent-based models and hypothesis testing: an example of innovation and organizational networks
Allen Wilhite and Eric A. Fong
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 221-238

Individual evolutionary learning with many agents
Jasmina Arifovic and John Ledyard
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 239-254

Evolution of market heuristics
Mikhail Anufriev and Cars Hommes
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 255-271

Zero intelligence in economics and finance
Dan Ladley
The Knowledge Engineering Review, Volume 27, Issue 02, June 2012, pp 273-286