Registro: La participación en SSW2020 es gratuita previa inscripción. http://ssc2020.behavelab.org/registration/

Tuesday, 15 September 2020, 2-5 PM (Central European Time-CET)

Workshop: Simulations in Economics

Chairs: Silvia London (Universidad Nacional del Sur, Argentina), Juan Gabriel Brida & Emiliano Alvarez (Universidad de la República, Uruguay).

Topics. The event proposes to present the most recent work on simulations in Economics of some Latin American research groups working in the area of Complex Systems, Agent-based Models, Nonlinear Dynamics and related topics. The collection of papers to be presented include some theoretical models that require the use of simulations, as well as empirical exercises applying simulation models to data. The individuals and research groups proposing the virtual workshop is an active group in LatinAmerica that works on the area of Complex Systems and particularly in Agent Based Models, with emphasis on issues related to emerging markets and the links between the economy, production systems and underlying socio-ecological systems.

Presentations

Martha Alatriste-Contreras (Universidad Nacional Autónoma de México, México): “The impact of sectoral shocks in the North America Production Network“. [co-authors: Alatriste-Contreras, M. & Puchet, M]

Abstract: In the context of the new trade agreement between the countries of North America (TMEC acronym in Spanish), it is important to evaluate the posible impact of sectoral shocks in the North America Production Network. We use input-output data for Canada, Mexico, the USA, and the region, a network diffusion model, and computer simulations to evaluate the effect of specific sectoral shocks in the countries’ and region’s economy. The diffusion model we use assumes that a sectoral shock changes the input-output connections between sectors, thus changes the way sectors produce. The results of the simulations shed light on the posible impacts of the new trade agreement and provide useful information to design an industrial policy focused on the development of the production network. In particular, we focus on recommendations for the Mexican economy.

Marcelo Álvez (Universidad de la República & Central Bank of Uruguay, Uruguay): "Progressive income tax and its emerging growth effects: a complex systems approach" [Co-authors: Alvarez, E., Álvez, M. & Brida, J.G.]

Abstract: The State as a distorting agent of the markets or the State as a corrector in the face of market failures, these are two characterizations that allow sizing the diversity of positions regarding the role of this particular agent of the economy. In this work, an agent-based stock-flow consistent model (AB-SFC) is applied to analyze the differences in the economies when establishing different types of taxes on personal income, proportional and progressive. Different combinations of threshold and rate are tested. There are no significant differences in economic performance in the presence of one tax scheme or the other. In the scenarios with higher rates, a slower recovery of the economy is noticed after a period of stagnation, but the difference is not significant at 90% significance. This design, which only distinguishes two sections of income, is not able to reduce the inequality generated throughout the income distribution. The tax design seems to offset the inequality in the lower section of income distribution through tax exemption for low-income households, but not the one generated in the section of higher income. An additional policy is necessary to offset the differences generated in the range of higher-income individuals. In this exercise, there is no evidence of a deterioration of economic growth in the presence of a progressive income tax, instead of a proportional one.

Emiliano Alvarez (Universidad de la República, Uruguay): “Agent Based Models and Simulation in Social Sciences: A bibliometric review” [co-authors: Alvarez, E., Brida, J.G. & London, S.]

Abstract: Since the first agent-based models (ABM), the scientific community has been interested in making not only the results of computational models understandable but also the modeling description, to facilitate their replication. The form that has been adopted to a greater extent has been the ODD (Overview, Design concepts, and Details) protocol, which provides a generic structure for its documentation. This protocol provides a way to clearly explain the procedures and interactions of the complex systems to be analyzed, with applications that have spread across
different disciplines. This work will show a bibliometric review of the articles that emerged from the first publication of this protocol in 2006, analyzing the development that ABMs have had in the social sciences. A description will be made of the lines of research with the greatest activity and the links between them will be analyzed; while summarizing the countries, universities, and journals with the highest contributions.

Nicolás Garrido (Universidad Diego Portales, Chile): “Crowding and price dynamics in tourism destination choice” [co-authors: Alvarez, E., Brida, J.G. & Garrido, N.]

Abstract: This paper analyzes how the preferences for crowding in destinations by tourists interact along the time with the pricing strategies of the resorts to determines the number of tourist visiting a tourist attraction. Destinations are experience goods and the stakeholders of the destinations use multiple signals to reduce the uncertainty of the consumers before their choice. Taking into consideration companies that seek to increase their profits and customers with budget restrictions and with both individual and social preferences, this work analyzes price dynamics and conditions of market competition, under an Agent-Based Modelling (ABM) setting. An emerging result of this process is the formation of companies with greater market power and high customer differentiation, although less than in the case without budget restrictions. At the same time, adjustment speed of the companies have non-linear effects on prices, the benefits of the resorts and individuals’ utility. Moreover, price dynamics is highly sensitive to the set of information that agents in the market have.

Daniel Heymann (Universidad de Buenos Aires, Argentina): “Behavioral heuristics and market patterns in a Bertrand–Edgeworth game” [co-authors: Heymann, D., Kawamura, E., Perazzo, R. & Zimmermann, M.G.]

Abstract: This paper studies Bertrand price-setting behavior when firms face capacity constraints (Bertrand–Edgeworth game). This game is known to lack equilibria in pure strategies, while the mixed-strategy equilibria are hard to characterize. We explore families of heuristic rules for individual price-setting behavior and the resulting market patterns, through simulations of agentbased models and laboratory experiments. Overall, the individual pricing strategies observed experimentally can be represented approximately by a sales-based simple rule. In the experiments, average market prices tend to converge from above and approach a state resembling a steady state, with slow aggregate price variations and low price dispersion around an average near the competitive level. However, that configuration can be disturbed occasionally by excursions triggered by discrete price raises of some agents. Salient features of experimental results can be described by simulations where agents use sales-based heuristics with parameters calibrated from the experiments. The results obtained here suggest the existence of useful complementarities between analytical, experimental and agent-based simulation approaches.

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