A Heterogeneous Agent Macroeconomic Model for Policy Evaluation: Improving Transparency and Reproducibility

66 Pages Posted: 3 May 2016

See all articles by Herbert Dawid

Herbert Dawid

Bielefeld University - Department of Business Administration and Economics; Center for Mathematical Economics

Philipp Harting

Bielefeld University - Faculty of Business Administration and Economics

Sander van der Hoog

Bielefeld University

Michael Neugart

Technical University of Darmstadt

Date Written: April 29, 2016

Abstract

This paper provides a detailed description of the Eurace@Unibi model, which has been developed as a versatile tool for economic policy analysis. The model explicitly incorporates the decentralized interaction of heterogeneous agents across different sectors and regions. The modeling of individual behavior is based on heuristics with empirical microfoundations. Although Eurace@Unibi has been applied successfully to different policy domains, the complexity of the structure of the model, which is similar to other agent-based macroeconomic models, has given rise to concerns about the reproducibility and robustness of the obtained insights. This paper addresses these concerns by describing the exact details of all decision rules, interaction protocols and balance sheets used in the model. Furthermore, we discuss the use of a virtual appliance as a tool allowing third parties to reproduce and verify the simulation results. The paper provides a systematic and extensive sensitivity analysis of the simulation output with respect to a set of key parameters. Particular emphasis is put on the question which parameter constellations give rise to strong economic fluctuations and high frequencies of sudden downturns in economic activity.

Keywords: agent-based macroeconomics, policy analysis, reproducibility, virtual appliance

Suggested Citation

Dawid, Herbert and Harting, Philipp and van der Hoog, Sander and Neugart, Michael, A Heterogeneous Agent Macroeconomic Model for Policy Evaluation: Improving Transparency and Reproducibility (April 29, 2016). Bielefeld Working Papers in Economics and Management No. 06-2016, Available at SSRN: https://ssrn.com/abstract=2773539 or http://dx.doi.org/10.2139/ssrn.2773539

Herbert Dawid (Contact Author)

Bielefeld University - Department of Business Administration and Economics ( email )

P.O. Box 100131
D-33501 Bielefeld, NRW 33501
Germany
+49-521-1064843 (Phone)
+49-521-1062994 (Fax)

Center for Mathematical Economics ( email )

Postfach 10 01 31
Bielefeld, D-33501
Germany

Philipp Harting

Bielefeld University - Faculty of Business Administration and Economics ( email )

Universitätsstraße 25
Bielefeld, 33615
Germany

Sander Van der Hoog

Bielefeld University ( email )

Universitätsstraße 25
Bielefeld, 33615
Germany

Michael Neugart

Technical University of Darmstadt ( email )

Hochschulstraße 1
Darmstadt, 64289
Germany

HOME PAGE: http://www.vwl3.wi.tu-darmstadt.de

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
133
Abstract Views
911
rank
260,073
PlumX Metrics