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Home / News

Nature - "This economy needs agent-based modeling"

August 14, 2009

Agent-based modeling (ABM) is a computerized simulation of agents interacting through given rules. ABM is used in tracking diseases and simulating behavioral patterns among societies, but has not been as well developed with financial and economic issues. SFI Resident Professor J. Doyne Farmer and SFI External Professor Duncan Foley present ABM could certainly be used on the complex system of financial economics. SFI External Professor John Geanakoplos, Farmer and colleagues have developed an ABM to explore how leverage affects fluctuations in stock prices. An ABM for the whole economy would take time and a lot of data of multidisciplinary collaborations of economists, psychologists, computer scientists, biologists and others. But it would be worth the work for a forecast that may help our economy.





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