[HN Gopher] Building an economy simulator from scratch
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Building an economy simulator from scratch
Author : Ruddle
Score : 136 points
Date : 2023-09-15 19:06 UTC (3 hours ago)
(HTM) web link (thomassimon.dev)
(TXT) w3m dump (thomassimon.dev)
| SpaceManNabs wrote:
| This website is really cool (not just the post). Thomas must have
| put a decent amount of work. How to find the secrets?
| orangepurple wrote:
| Great start! Some things to consider for future versions: more
| sophisticated tax code, financial regulations, monopsonies,
| monopolies, collusion, corruption, oligarchies, demand
| elasticity, cascading effects from supply chain disruptions,
| central bank quantitative easing.
| econorew wrote:
| All of this is emergent behaviour. Agents need to be smarter
| and the networks need to be larger and information needs to
| have a cost.
| nylonstrung wrote:
| A lot of this is Macroeconomics- Microeconomics (what this
| focused on) is effectively a different discipline. You can't
| really model both of them within the same framework
|
| Source: econ major
| econperplexed wrote:
| OT: I see economists of various ideological tilts constantly
| arguing about how macroeconomic variables will respond to
| specific government policies. You know: "this new tax will
| increase inflation; no it will not, it will increase
| unemployment".
|
| What I don't get is why there are no readily available online
| macroeconomic simulators with real world data that make these
| sort of predictions. For a lot of countries, up-to-date
| macroeconomic and demographic is readily available.
|
| Surely, economists of every ideological tilt have their own
| standard model of macroeconomics [1] which they use to make rough
| predictions? If not, how complicated is it really?
|
| [1] Much like the standard model of particle physics or of
| cosmology. Fairly dirty and complicated models with lots of
| tunable parameters.
| sdfghswe wrote:
| > What I don't get is why there are no readily available online
| macroeconomic simulators with real world data that make these
| sort of predictions.
|
| Are you high or what?
|
| The problem is so complex that people don't even agree how to
| _take a measurement_ , let alone how to simulate the system. If
| nowadays people disagree when looking at the same numbers,
| imagine if each one could point to the numbers in his own
| simulator.
| redandblack wrote:
| but but ... you cannot have data get in the way of good theory.
| [deleted]
| jl6 wrote:
| An "economy" is composed of people, so maybe we can do this
| once we've cracked simulating people.
| amelius wrote:
| Because a good model would be like a self-defeating prophecy.
| ttymck wrote:
| Why do you think economics is as deterministic as particle
| physics? Why should a simulation be any more informative than
| an economist's assumptions?
| KRAKRISMOTT wrote:
| Particle physics isn't that deterministic either. It uses a
| lot of statistical tricks and hard engineering to reach its
| results. That's why there are so many physicists working as
| quants.
| logicchains wrote:
| >[1] Much like the standard model of particle physics or of
| cosmology. Fairly dirty and complicated models with lots of
| tunable parameters.
|
| Anyone capable of making models that can predict the future
| with a reasonable degree of accuracy is probably in finance,
| making 5-10x what they could in economics. The economy is an
| incredibly complex system, subject to emergent behaviour and
| chaotic effects, much more so than in physics. You'll see
| papers from the large hadron collider where they prove stuff to
| within p=0.000001; it's impossible to prove anything to that
| degree of confidence in economics. Especially because it's not
| possible to create true controlled experiments: you can't have
| two otherwise identical societies that differ by just one
| factor, rather there will always be other ways in which they
| differ to, and how these are accounted for can have a big
| effect on the output of models.
| econperplexed wrote:
| Any model has some precision associated with it. I am not
| asking for 5 sigma level of precision. But if the economists
| are fighting about what will happen to a particular
| macroeconomic variable, they are making a prediction even if
| it is a log_2(3) bit prediction [1]. There must be some math
| that is backing that. I want to see it explicitly put into a
| computational model that runs on live data. Otherwise is
| there any real content to the arguments that economists are
| having?
|
| > Especially because it's not possible to create true
| controlled experiments
|
| Cosmology has zero-experiments. It is a completely
| observational science [2]. And in fact, has very bad data.
| Basically a time-frozen snapshot of the universe from a
| particular point in space. They can't even make predictions
| about the future, only about what some new dataset of that
| same time-frozen universe will say. Economics on the other
| hand has the benefit of lots data about interventions and
| their consequences. There is so much opportunity to develop
| models by making predictions and checking what happens.
|
| [1] variable goes up or down or stays the same.
|
| [2] The fact that the roots of _modern_ science lie in a
| purely observational no-experiment discipline of astronomy is
| lost on many.
| logicchains wrote:
| > But if the economists are fighting about what will happen
| to a particular macroeconomic variable, they are making a
| prediction even if it is a log_2(3) bit prediction [1].
| There must be some math that is backing that. I want to see
| it explicitly put into a computational model that runs on
| live data
|
| This is what (some) people in finance do: make models to
| predict things, because if something about the future can
| be predicted to a sufficient degree of accuracy, it's
| generally possible to make money from it. In economics, the
| incentives are slightly different; in academia, the
| incentives are to publish interesting/novel/topical papers,
| like with other social sciences, not necessarily to make
| repeatable predictions. In social science nobody gets
| punished for making an interesting model that hasn't been
| rigorously proven to make repeatable predictions, while in
| finance on average better models make more money and get
| rewarded more. But sharing an effective model means other
| people can use the predictions too, meaning you capture
| less value from the predictions yourself, so people with an
| effective model have an incentive not to share it
| ch4s3 wrote:
| > What I don't get is why there are no readily available online
| macroeconomic simulators with real world data that make these
| sort of predictions.
|
| You aren't the first person to have this thought. It just turns
| out to be incredibly difficult.
| lainga wrote:
| Consider examining different utility functions and substitutable
| goods
| jampekka wrote:
| No banks, no capital, no capitalists living off the workers'
| labour. This is not even close how the economy works.
| [deleted]
| random3 wrote:
| You know banks exist outside of capitalism, no?
| NoMoreNicksLeft wrote:
| This is interesting, in that I've tried to come up with simple
| simulations like this for strategy games before. But I was a
| little "eww" when he kicked the number of government workers up
| to 40% of the workforce. Looks like it goes all the way up to
| 50%.
|
| On simulation #13, where tax is fixed at 10%, the government
| workers all eventually starve. Surprisingly, the libertarians are
| correct because at this point the quality of life index abruptly
| rockets up to twice what it used to be. But there's some sort of
| robotic overlord AI going on, it still collects the tax.
|
| But then in simulation #18, things become a little insane. I call
| this one the Massachusetts simulation... only 3 workers, but 9
| government employees. For a 3:1 ratio. The simulation suggests
| that some sort of economic meltdown occurs and they all starve,
| but I suspect that things were a little more violent than that.
|
| After, the developer then introduces ration tickets. This is
| simulation #20, and I'm pretty sure it's Zimbabwe. But it's not
| the real world Zimbabwe, it somehow works. That is, if you're ok
| printing trillion dollar bills.
|
| Simulation #21 takes a new direction entirely. FDR has been
| elected, and tries to stamp out competition... but he is too
| late, evil capitalist farmers have grown too many apples, which
| perversely leads to starvation. Careful apple quotas are needed.
| The government has disappeared though, probably because late
| stage capitalism destroyed it. Only the corporations survive.
|
| Surprisingly, no farm subsidies yet. I predict the introduction
| of a new private sector worker, the ConAgra lobbyist. We'll see
| if he shows up in a later simulation. That is, assuming another
| government is elected.
|
| In simulation #25, one of the warlords has settled down and
| become a government again. But this is the last of the
| simulations. No lobbyists, though the central bank has returned.
| This might be because Andrew Jackson has died. I did not like the
| man, he will not be missed. But quite clearly the inflation is
| through the roof again, and 30% taxes are here to stay.
|
| What I've learned from these is that history is a lie. Rhodesia
| probably never existed, and Zimbabwe happened before the US civil
| war.
| dclowd9901 wrote:
| > After, the developer then introduces ration tickets. This is
| simulation #20, and I'm pretty sure it's Zimbabwe. But it's not
| the real world Zimbabwe, it somehow works. That is, if you're
| ok printing trillion dollar bills.
|
| In a cashless society, I suspect the zimbabwe method would
| actually probably work. The only hangup was "Now I need to
| crate around boatloads of money". In a cashless society, we can
| just move the decimal point every so often.
| marcosdumay wrote:
| > at this point the quality of life index abruptly rockets up
|
| That's because on this simulation the government isn't doing
| any useful work.
|
| The ration tickets work because the people were programed to
| actually follow the law. It fails every time on the real world
| because real people aren't.
|
| And the simulation #20 works because the simplistic model
| actually works. At a first approximation, inflation isn't a
| problem at all. Things only start to fail after you have
| competition, corruption, very limited resources, etc.
|
| Simulation #21 is a great visualization of why people must be
| able to set prices with enough freedom, and why forced price-
| fixing bankrupts countries.
| NoMoreNicksLeft wrote:
| > the people were programed to actually follow the law. It
| fails every time on the real world because real people
| aren't.
|
| Is anyone working on the problem of programming people? Or
| are we just hoping for a solution to that to fall into our
| laps?
|
| > and why forced price-fixing bankrupts countries.
|
| Ah ha! On this one I paid very close attention. No secret
| libertarians hiding in woodpiles, and sneaking out at night
| (or any other time) and stealing from the people. The only
| rational conclusion is that the simulation was set up to fail
| as some sort of propaganda.
|
| Besides, only a few people died anyway, which for any
| socialist country is miraculously impressive success. So
| maybe not propaganda.
|
| I'm beginning to think these simulations don't offer any
| insight into the real world at all.
| dclowd9901 wrote:
| The "useful work" was implied. That is, the assumption was
| the government was perfectly valuable to society with
| relation to the cost it incurred. It might've been
| interesting to see the government throw money at the farmers
| every year or so, though.
| nologic01 wrote:
| Beautifully made and illustrative of a currently non-existing
| branch of economic education, if not economic theory itself.
|
| While people get to be force-fed all sorts of complex subjects at
| school, economics does not feature prominently.
|
| The result of this widespread economic illiteracy is easily seen
| at the quality of political discourse.
| amelius wrote:
| Sounds like something an LLM could help with. You could write
| rules in natural language, and the system would automatically
| convert it into simple code.
| [deleted]
| bagpuss wrote:
| The MONIAC built in the 1950s by Bill Phillips (of Phillips curve
| fame) attempted to model economic processes with coloured water
| (fluidic logic)
|
| https://en.m.wikipedia.org/wiki/MONIAC
| 0xADADA wrote:
| dont' mistake a beautiful map for the territory, you'll find
| yourself lost amongst lines that aren't a real place.
| dclowd9901 wrote:
| It sounds like you take issue with this simulation? It applies
| heavily academic and simplistic rules around behavior. I like
| build up of it all to illustrate _simulating things_, but I
| think almost any traditional economics theory outside
| behavioral economics ought to be shelved for good.
| cgio wrote:
| I would agree up until recently. I am starting to think,
| though, that behavioral is only relevant in an economy of
| choice. With choice I keep it simple to having the option to
| spend or not wealth (including consuming/selling some of your
| stock). The less choice in the market, the more the classical
| models will be reasonable and efficient approximations as
| they can accommodate one sided choices. Complex dynamics are
| not what we experience now. There is a market direction, the
| power to impose it and its application at clear sight.
| [deleted]
| sunday_serif wrote:
| On Exactitude in Science By Jorge Luis Borges
|
| ...In that Empire, the Art of Cartography attained such
| Perfection that the map of a single Province occupied the
| entirety of a City, and the map of the Empire, the entirety of
| a Province. In time, those Unconscionable Maps no longer
| satisfied, and the Cartographers Guilds struck a Map of the
| Empire whose size was that of the Empire, and which coincided
| point for point with it. The following Generations, who were
| not so fond of the Study of Cartography as their Forebears had
| been, saw that that vast Map was Useless, and not without some
| Pitilessness was it, that they delivered it up to the
| Inclemencies of Sun and Winters. In the Deserts of the West,
| still today, there are Tattered Ruins of that Map, inhabited by
| Animals and Beggars; in all the Land there is no other Relic of
| the Disciplines of Geography.
|
| source: https://kwarc.info/teaching/TDM/Borges.pdf
| The_Blade wrote:
| nice, you beat me to this gem (with a side of Lewis Carroll
| and Baudrillard) because I was finishing work
|
| the lesson is, never try
|
| edit OH and the other part is that it was staged literary
| forgery by "Suarez Miranda, Viajes de varones prudentes,
| Libro IV, Cap. XLV, Lerida, 1658." Borges overclocked the
| meta
| zwieback wrote:
| This is so cute, love the animation and idea behind it.
|
| Just yesterday I listened to Planet Money talk about how Bill
| Phillips got a position at the London School of Economics on the
| strength of his hydraulic computer simulating the economy:
| https://en.wikipedia.org/wiki/MONIAC
| Terr_ wrote:
| MONIAC was also featured/satirized in the Terry Pratchett book
| "Making Money":
|
| __________________
|
| > "Mr. Hubert believes that this... _device_ is a sort of
| crystal ball for showing the future, " said Bent, and rolled
| his eyes.
|
| > " _Possible_ futures. Would Mr Lipstick like to see it in
| operation? " said Hubert, vibrating with enthusiasm and
| eagerness. Only a man with a heart of stone would have said no,
| so Moist made a wonderful attempt at indicating that all his
| dreams were coming true.
|
| > "I'd love to," he said, "but what does it actually do?"
|
| > Too late, he saw the signs. Hubert grasped the lapels of his
| jacket, as if addressing a meeting, and swelled with the urge
| to communicate, or at least talk at length in the belief that
| it was the same thing.
|
| > "The Glooper, as it is affectionately known, is what I call a
| quote analogy machine unquote. It solves problems not by
| considering them as a numerical exercise but by actually
| duplicating them in a form we can manipulate: in this case, the
| flow of money and its effects within our society become water
| flowing through a glass matrix--the Glooper. The geometrical
| shape of certain vessels, the operation of valves and, although
| I say so myself, ingenious tipping buckets and flow-rate
| propellers enable the Glooper to simulate quite complex
| transactions. We can change the starting conditions, too, to
| learn the rules inherent in the system. For example, we can
| find out what happens if you halve the labour force in the city
| by the adjustment of a few valves, rather than by going out
| into the streets and killing people."
|
| > "A big improvement! Bravo!" said Moist desperately, and
| started to clap.
| Workaccount2 wrote:
| I've long had the fantasy of an economics simulator given dwarf
| fortress levels of dedication and attention to detail. This might
| not be it, but it does warm my soul a bit.
| dragontamer wrote:
| Tropico series is simple but fun.
|
| The bulk of it is obvious Capitalism vs Communism political
| jokes though, so I wouldn't consider it a very serious economic
| simulator. But its better than most IMO.
| michael_j_x wrote:
| star citizen with its quantum economic simulator is close
| enough: https://www.boredgamer.co.uk/2020/04/24/star-citizens-
| quantu...
| ilyt wrote:
| I had hopes for Victoria 3 but it didn't exactly stick the
| landing
| andrewmutz wrote:
| It's not perfect, but they are investing a lot of time on
| improvements. Paradox games tend to get better over time. 1.5
| introduces province-level prices, which make supply chains
| more interesting.
| Supply5411 wrote:
| Simulation 16 is hilarious. By the state dynamically scaling how
| much they print money in order to support government workers,
| government workers accumulate more wealth than the producers of
| goods.
| epicureanideal wrote:
| Sounds like state workers in California
| vanrysss wrote:
| See LA lifeguards making $300k/yr https://lamag.com/news/the-
| highest-paid-lifeguard-in-l-a-mak...
| mapmap wrote:
| How does this happen?
| lotsofpulp wrote:
| Every single government employee and their family/friends
| vote in local elections, and other people do not. You
| will not win an election without their votes, and you can
| use opaque compensation like DB pensions and whatnot to
| hide and punt forward the costs of the compensation.
|
| You will never find a non taxpayer funded entity promise
| something like this:
|
| >After 30 years of service, LA lifeguards can retire as
| young as 55 on 79-percent of their pay.
|
| Go ask an insurance company how much an annuity for even
| $80k would cost starting at age 55 until death. It would
| be $1M+.
|
| Social Security averages out your earnings for your whole
| lifetime to calculate the benefit, and that is with the
| power of the federal government. City and state
| governments regularly promise employees final average 1,
| 3, 5, and at best 10 pay formulas. So you see
| cops/firefighters/lifeguards/etc spiking their overtime
| and working 80 hours per week for the last few years,
| doubling and tripling their DB pension benefit.
|
| And you simply will not see this outside of taxpayer
| funded entities.
| willsmith72 wrote:
| so you mean the solution to that would be mandatory
| voting?
| lotsofpulp wrote:
| No, I think it is still too complicated of an issue to
| burden voters with understanding. The better solution
| would be restricting all employer employee compensation
| arrangements to cash only.
|
| That would solve politicians being able to pay with
| unaccounted for benefits that become a burden decades
| later, and increase labor price transparency and result
| in better functioning markets once employers are out of
| the health/vision/dental/public transport/retirement
| benefit business.
|
| And a third bird it kills is reducing the advantage big
| businesses have over small businesses.
| idontpost wrote:
| [dead]
| ta1243 wrote:
| Those that actually produce goods are very far down the wealth
| pecking order
| dclowd9901 wrote:
| And the social pecking order, it would seem.
| [deleted]
| Nezteb wrote:
| Is the source code for this simulator available anywhere? The
| post's code itself is minimized/obfuscated:
| https://thomassimon.dev/assets/cashloss.1fca21f6.js
|
| I couldn't find anything on the author's GitHub. I'm mostly just
| curious how it's built.
| Ruddle wrote:
| Author here, if there is enough interest I can clean the code
| up and put it on GitHub. It is basically a state machine.
| Nezteb wrote:
| I'd appreciate it. :D
| jll29 wrote:
| Would be nice to see a post written about the high-level
| design and then about the implementation.
| _false wrote:
| Just to add to others; I'd be interested to take a look at
| the source, particularly for animations.
| coderintherye wrote:
| I'd love to see it, even in unpolished state.
|
| It'd go well as comparison vs. this code I've been playing
| around with from Phillip Rosedale (Founder of Second Life)
| where he's simulating economy for purposes of determining
| wealth distribution scenarios:
| https://editor.p5js.org/PhilipRosedale/sketches/odl5elMWy
| xwdv wrote:
| State machine? Why not entity component system?
| keskival wrote:
| The simulation only has workers/producers and it has a free
| market - it is missing capitalism. To make it realistic you need
| a subset of people owning the labor output of others, taking out
| all the surplus, using it to buy stakes of more economic
| activity, diverting profits to themselves, thus creating the loop
| of concentration of wealth which removes the surplus wealth from
| the producers and assigns it to ever decreasing number of ever
| wealthier individuals.
| Supply5411 wrote:
| Where are the bad actors who exploit the system to steal from
| everyone? No economic simulator is complete without this.
|
| Edit>> It appears to be the state.
| [deleted]
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(page generated 2023-09-15 23:00 UTC)