[HN Gopher] Building an economy simulator from scratch
___________________________________________________________________
Building an economy simulator from scratch
Author : Ruddle
Score : 421 points
Date : 2023-09-15 19:06 UTC (1 days ago)
(HTM) web link (thomassimon.dev)
(TXT) w3m dump (thomassimon.dev)
| gsuuon wrote:
| That's one of the most entertaining posts I've seen in a while.
| Would very much like to see a part 2. Also, as an aside, wow are
| those some tasteful gradients on the recent post links.
| 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?
| teo_zero wrote:
| Am I the only one to find the simulation deviate from the
| description starting from Simulation 8?
|
| For example, I see a farmer with 7 food, 7 water and 7 wood,
| buying water. According to the description, their QoL would be 7
| both before and after the transaction, so they are not supposed
| to buy because there wouldn't be an increase of their QoL:
|
| > People are potential buyers of the resources that increase
| their quality of life
|
| Additionally the average QoL indicator seems wrong. This is what
| I see at step 72: Farmer 1: 50$ 6 6 5 => QoL 5
| Farmer 2: 90$ 4 4 5 => 4 Farmer 3: 10$ 7 7 7 => 7 Avg
| QoL 3.0
|
| How can 3.0 be the average?
| Ruddle wrote:
| Author here, In case all resources are equally owned, the QoL
| is bound to all of them (as opposed to none). It does take
| multiple purchases to increase the QoL, but it is the only way.
| Otherwise people would starve due to aboulomania.
|
| The average QoL is sampled each end of day, step 73-75
| depending on the random seed. At step 72 you are seeing the
| zeroth day average QoL ,with nearly all the intraday mutations
| of the first day.
| teo_zero wrote:
| Thanks for the explanation. It makes perfectly sense.
| 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.
| rsrsrs86 wrote:
| One really cool thing to do is consider the agents to have
| limited computational capacity. There are a few NP economic
| problems, and you can't expect agents to really be solving
| enormous computational problems in their heads.
| 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
| rsrsrs86 wrote:
| Undergrad Econ courses still present micro and macro
| economics as two disciplines, but that's theory from the 70s
| at best.
|
| Graduate level economics packs a lot of economic models where
| for example the interest rate depends on the intertemporal
| preferences of different types of agents.
|
| It just gets terribly complicated.
| motohagiography wrote:
| The game "Captain of Industry" might be a more complete
| simulation:
| https://store.steampowered.com/app/1594320/Captain_of_Indust...
|
| Big thread on it from last year here:
| https://news.ycombinator.com/item?id=31586833
| bavell wrote:
| I bought it after seeing that post at the time, great game of
| you're a fan of games like Factorio. Very well designed and
| tons of fun!
| jwiz wrote:
| Any time I try to play not-Factorio, I become frustrated with
| how unpolished their interfaces are in comparison.
| neilwilson wrote:
| I'd love to work on this more. Definitely would like to see it on
| GitHub.
|
| If we're talking about money printing then we need to talk about
| money shredding as well.
|
| If government prints money to buy thing then taxation feeds old
| money into the shredder.
|
| Print is always matched with a shred.
|
| Even bank loans are paid off (shredded)
| logicallee wrote:
| Great set of simulations!
|
| Can someone explain why in Simulation 16, 4 producing workers can
| support 3 non-producing workers consuming just as much as them
| with just 10% taxation and yet they have similar QOL? It doesn't
| make sense to me intuitively.
|
| If we ignore money and just look at goods this implies 3 people
| can do "nothing" (the government workers don't buy from anyone in
| this simulation) and yet consume as much as 4 people who do
| produce, and the 4 taxed people only have to pay 10% taxes while
| everyone enjoys similar quality of life as 60% taxation.
|
| It would be like imagine you have four cartons of ten eggs and
| you tax 10% of each one. How can you end up with 3 whole cartons
| just from that taxes, it would only be four eggs, less than half
| of one carton rather than three extra cartons of the same size as
| the new reduced carton size of 9.
| Ruddle wrote:
| Author here, simulation 16 shows that money printing, and tax
| have common effects. The state can replace one with another.
| Here the 65% tax is replaced with 10% tax plus inflation, i.e.,
| giving new money to public servants. The new money creation
| decreases the value of money owned by producing workers.
|
| We could even remove the tax entirely, and still support the 3
| public servants. To be convinced you can look at each unit
| transaction and see that all resource are accounted for.
|
| Another way to look at it, is that the QoL of producing workers
| is lower than if there was no public servants. Every resource a
| public servant has, is bought from a worker at some point,
| whether the money for the purchase comes from taxation or
| inflation.
| littlestymaar wrote:
| This is fun, but it is as much of an "economy simulator" as
| Factorio is "logistics simulator". It's not just that it is a
| simplification, it's just completely made up stuff that just
| looks like "popular understanding of economics".
| 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.
| econperplexed wrote:
| Lets take a very particular variable. Every month or so,
| central/state banks in every country have a meeting to decide
| the policy rate. They look at some data and the output of
| some models, then wave some political magic wand over it and
| make a decision about which direction to move the rate. Then
| they make a statement like, "our decision will decrease
| inflation over the next three quarters by this much."
|
| The data they use is usually publicly available, the models
| used by these must not be very secret. Is it not possible to
| hook this all up into a nice package, where I can go in and
| tune some knobs to my liking (there will always be knobs) to
| get a prediction on the inflation over the next three
| quarters.
|
| Then, I can publicly claim, "Given this data, and this model,
| and my knob settings, here are my prediction." Then some
| other economist can come and dispute the data, model and the
| knob settings. They select a different data source, model and
| their own knobs.
|
| Then three quarters later we check who made the right
| prediction.
|
| Notice, I am not asking for the correct model of reality.
| Only a playground where people can argue using concrete data,
| models and knobs.
| mathiasgredal wrote:
| The Danish Ministry of Finance has a public model they use
| to forecast the economic impact of certain policy decisions
| called MAKRO: https://github.com/DREAM-DK/MAKRO/tree/main
| 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.
| wordpad25 wrote:
| psycohistory!
| 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.
| HDThoreaun wrote:
| The only real rule in economics, other than simple accounting
| identities, is that people will do what they think is best for
| themselves. But everyone's utility curve is different, let
| alone their perception of their utility curve. It's incredibly
| difficult to rigorously model.
| Aeolun wrote:
| At sufficiently large scale we should be able to model
| certain personalities though.
| HDThoreaun wrote:
| Imo a decent economics simulator is indistinguishable from
| a full physics simulator. There's no other way to account
| for the actions of millions of independent actors with
| unique incentives. Econ models tend to focus on very
| specific independent variables and hold everything else
| constant because there are just too many dimensions to
| consider in a full model
| 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.
| rsrsrs86 wrote:
| Best you can get is some bounds for whatever effect you
| want to predict and those bounds will open wide very fast.
|
| As for lots of data, doing proper econometric models
| requires really well gathered data. Data is published
| quarterly or yearly, so you do have comparable series for
| international country level macroeconomics, but those are
| actually short considering how many variables must
| interact.
| Aeolun wrote:
| > I want to see it explicitly put into a computational
| model that runs on live data.
|
| I _also_ want to see it. But I do not want to build it,
| since it seems incredibly boring.
| 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
| rsrsrs86 wrote:
| Few scientific hypothesis have been tested by so much
| money as that there is no alpha in the market. I mean,
| the amount of money that goes into proving that wrong is
| perhaps larger than what went into finding the Higgs
| boson.
| 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.
| mikhailfranco wrote:
| Sounds like we need _wikiconomy_ crowd-sourced model building
| over two open-source platforms:
|
| - mathematical macro-economic simulation run by differential
| dependencies (like Minsky)
|
| - agent-based Monte-Carlo platform for behavioural
| experiments to find or validate the macro rules
|
| There would be a core set of models, with parametrized
| instances running for each country, loosely coupled through
| trade flows, capital flows, FX markets and migration.
| rsrsrs86 wrote:
| Economics is a science and what an economist calls economics is
| not what the market things an economist knows.
|
| In a science you are interested in testing hypothesis.
|
| Econometric/statistical models will generally serve to test
| general hypothesis. What happens if we raise interest rates?
| Will inflation go down? This can be tested in many ways. But it
| is not a concern to actually predicate the values of
| macroeconomic variables. It's really not interesting
| academically and basically impossible to do right.
|
| This is of course completely out of vogue since ML wiped out
| the scientific method education of us all.
| denton-scratch wrote:
| In the late 80s, I typed in a BASIC economy simulator I found in
| some computer magazine. It ran to two or three closely-typed
| pages (sides).
|
| As Chancellor of the Exchequer, you set the tax-rate, interest
| rate, level of public spending and so on; then you ran a cycle. I
| can't remember whether a cycle was a month or a year. After about
| three years, the workers would be on strike and there would be
| rioting in the streets. Every time.
|
| I wasn't particularly interested in macroeconomics at the time; I
| certainly had no idea how to run an economy. I have no idea how
| realistic the economic model was. I assume it was just a bit of
| fun.
|
| But I'd like to tinker with a realistic economic model that is
| flexible enough to, for example, model Modern Monetary Theory.
| didgeoridoo wrote:
| Ah, you see, you have to turn off the IS_FRANCE option.
| bwanab wrote:
| I think anybody who's ever tried to model MMT feels the same
| way. I suspect the underlying theory doesn't have enough
| substance to actually model.
| dkga wrote:
| Economist here. Why Modern Monetary Theory in particular? Just
| curious :)
| nonrandomstring wrote:
| If you like playing this sort of thing I must recommend NetLogo
| [0].
|
| It's an "agent" based modelling environment, so you have to
| "discretize" (yuck) your problem first.
|
| I learned about it because Scott Page uses it for his "Model
| Thinking" class [1].
|
| [0] https://ccl.northwestern.edu/netlogo/
|
| [1] https://modelthinker.wordpress.com/
|
| There is also the MIT "systems modelling for a complex world"
| ricksunny wrote:
| +1 - I studied Netlogo when I dabbled in economic simulation
| several years back. And alas as a non-software engineer my
| coding skills were not up to the task for even Netlogo's
| simplified interface. Yet NL serves as a valuable wrapper for
| any mesh- or distributed agent programming problem - (for
| those more skilled than me). One doesn't have to know OOP or
| anything to get an instructive simulation - (e.g. wolves vs
| sheep vs grass behavior) up and running. =)
| lainga wrote:
| Consider examining different utility functions and substitutable
| goods
| rsrsrs86 wrote:
| This. At least a general equilibrium model.
| throwaway290 wrote:
| To simulate economy, you need to simulate individuals with their
| wants and needs and relationships and the environment, as simple
| (complex) as that.
| 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?
| vkou wrote:
| While it's true that banks can exist outside capitalism,
| capitalists generally can't.
|
| ---
|
| The parent's point is that an economic simulator that does
| not include them is probably not something that's useful to
| draw conclusions about capitalist societies from.
|
| It is a fun toy, though.
| dragonwriter wrote:
| > While it's true that banks can exist outside capitalism,
| capitalists generally can't.
|
| That's not really true; people who own and profit from
| their ownership of the means of production exist in feudal
| economies; the fact that their ownership of the means of
| production is a sonetimes a consequence of rights
| associated with land tenure and, whether or not that is the
| case, not marketable or less freely so than under
| capitalism the capital, makes the _system_ not capitalism,
| but doesn 't make the owners of capital not capitalists.
|
| Capitalists _qua_ capitalists aren't the ruling class
| outside of capitalism (though being a capitalist was also a
| subordinate part of being part of the labded aristocracy,
| and control of certain elements of the means of production
| was connected to land tenure), but they still can exist.
| Capitalism as a system is mostly a result of the non-
| landholding capitalists progressively leveraging their
| existing wealth to gain more systemic advantage (at the
| express of the landed aristocracy) than they enjoyed in
| pre-capitalist economies.
| spiralx wrote:
| If you separate capitalists and landlords out as
| different classes (in the Georgist sense) then you can
| say that landlords have extracted rent for far longer
| than capitalists have been around; it took the Industrial
| Revolution to move from the guild-based master and
| apprentice model to a capital-based owner and worker
| model of production.
| random3 wrote:
| That's exactly my point. It's clear both from banking
| history as well as general history and experience living
| in a communist country for a while.
| jampekka wrote:
| Yes.
| blamestross wrote:
| Beware optimizing for "average" quality of life, we did that and
| it worked. Turns out it is more efficient to have a super-
| minority with a very high QoL. Median is a better target.
| imathew wrote:
| "If you wish to build an economy simulator from scratch, you must
| first invent the universe."
| 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.
| jameshart wrote:
| It's definitely important, when analyzing the impact of
| policies on an economy, not to get hung up on things like
| 'what the numbers on the banknotes look like' rather than
| important things like 'how well the population's wants and
| needs are satisfied'. Certainly it's not inherently a problem
| to continually have to revalue your currency if the net
| effect of your economy is it makes a lot of happy people, and
| it's certainly not impossible to imagine that a functional
| stable productive economy might coexist with a rapidly
| inflating - or deflating - currency.
|
| But the simulation doesn't do much to validate that concept.
| It introduced inflation to a group of agents who never think
| about the future value of their goods or money.
|
| In a runaway inflation situation, some producers of apples
| aren't going to sell you apples today for 1,000 Simoleons,
| when they know tomorrow those apples will fetch 1,100
| Simoleons... and by Friday they'll be worth 10,000. And some
| holders of Simoleons will think 'These 10,000 Simoleons could
| buy be ten apples today, but tomorrow they'll only buy me 9,
| and by Friday they'll only buy me one... so I should buy 10
| apples today, then sell them on Friday'.
|
| Without capital accumulation, time valued money, or
| investment, this simulation barely scratches the surface of
| what effects inflation has on an economy.
| LeonB wrote:
| > so I should buy 10 apples today, then sell them on
| Friday'
|
| Simulation might also want to take into account that you
| can't stock pile apples indefinitely before they spoil.
| 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.
| vkou wrote:
| > Is anyone working on the problem of programming people?
|
| We gave The New Soviet Man[1] a try for a couple of
| decades, but it didn't really stick.
|
| As the late-20th, early 21st century has shown, programming
| that seeks to amplify our vices[2], as opposed to turn us
| against them turned out to be far more effective.
|
| [1] https://en.wikipedia.org/wiki/New_Soviet_man
|
| [2] Don't think, just buy.
| 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.
| gus_massa wrote:
| I think it'd be interesting to a more in-game useful work
| of the government. For example that the homes of the
| producer may catch fire randomly. If there is at least a
| firefighter there is no problem, but once all firefighter
| die, then there is a 1% chance per day that each producer
| may burn and die.
|
| At the beginning of #13 eve thing is fine, until all
| firefighter die and the quality of life index abruptly
| rockets for a while. Then for example the apple producer
| dies, and after a few days everyone starves and dies.
|
| It may be a more complicated criteria, like each
| firefighter can protect only 2 or 3 producers, so the ratio
| of producers to government workers must be always not too
| high.
| 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.
| dools wrote:
| This adds money in before it adds the state, or taxation. Money
| is created through taxation by the state to provision resources
| away from the private sector to the public purpose.
| [deleted]
| dave333 wrote:
| Prof Steve Keen has developed a free tool called Minsky for
| economic modeling as well as many models:
| https://www.youtube.com/@ProfSteveKeen
| neilwilson wrote:
| " tax works by pooling a percent of sellers revenue."
|
| What the public servant actually does is impose a tribute on the
| workers _in a denomination the public servant determines_. If you
| don 't provide the denomination then the public servant
| confiscates your assets by force.
|
| The population then offers their goods and services in return for
| the denomination the public servant _issues_. The public servant
| then determines the level of the tribute required by how much of
| its own denomination it gives in exchange for the tribute.
|
| That's the source of money, and the source of the price level.
|
| There is no 'universal exchange commodity'. Money is really just
| promises between people.
|
| Fred would say to Jim: "here's a pig, owe me one". Fred now has
| Jim's IOU as an asset which he could give to Bob in exchange for
| something Bob made so Bob can claim a pig from Jim.
| lottin wrote:
| > That's the source of money, and the source of the price
| level.
|
| What do you mean?
| nvy wrote:
| >That's the source of money, and the source of the price level.
|
| The vast majority of money in the modern economy is created by
| banks, not by the tax agencies or even the mint. When the bank
| lends you $1000 they just create it out of thin air and credit
| your account by $1000.
| neilwilson wrote:
| Using what for collateral?
|
| Yes banks create money but all they do is discount what
| already exists.
|
| As every budding entrepreneur finds out when they try to get
| a loan at 17 years old.
|
| Banks provide liquidity after the fact. They don't kick the
| system off.
| jschveibinz wrote:
| This is largely correct. Commercial banks are permitted to
| leverage deposits (Tier 1 capital) by a large ratio.
|
| _If a bank lends $10 for every $1 of capital reserves, it
| will have a capital leverage ratio of 1 /10 = 10%.
|
| According to the Basel III standards, this ratio must be at
| least 3%, though country-wise regulations may vary._
|
| https://www.wallstreetmojo.com/leverage-ratios-for-banks/
|
| But money is also created in other ways. Here is a short
| article on how money creation, value creation and wealth
| creation are related:
|
| https://nickrogers.tech/money-creation-wealth-creation-
| value...
|
| Cheers!
| mordae wrote:
| They still have to borrow the money from the central bank.
| Fractional reserves mean that the credited account's bank
| must deposit a portion of the money bank at central bank.
|
| So there is a limit to how much money can the bank create.
| neilwilson wrote:
| They don't. Reserves are irrelevant for bank lending.
|
| They are nothing more than a centralised optimisation of
| what would otherwise be a full mesh network of point to
| point exchanges
| tomatocracy wrote:
| Mostly banks borrow from depositors and from the capital
| markets.
|
| Reserve requirements of that type still do exist in some
| places (though in some places they've been abolished) but
| don't really play much of a role in determining how quickly
| money supply grows any more.
|
| Control over money supply growth is mostly down to interest
| rates these days.
|
| Similarly, the role reserve requirements used to play in
| protecting depositors has been replaced by the various
| "Basel" rules which determine what sources of funding banks
| can use to fund their loans which depend on the loan book's
| credit quality, tenor etc.
| neilwilson wrote:
| Banks don't borrow from depositors.
|
| Loans create deposits and the deposits just change
| ownership tag from then on.
| tomatocracy wrote:
| A deposit is literally you lending money to your bank,
| payable on demand.
| neilwilson wrote:
| That's not the point. The point is where what you have
| came from in the first place.
|
| A loan creates an advance. That advance is the bank owing
| a person in return for the person owing the bank.
|
| The advance is then used to pay you so you have a
| deposit. All that does is change the ownership tag on the
| advance.
| kqr wrote:
| I mean, they do, to the extent that people walk into
| banks and hand over wads of cash for deposit. I.e. it
| happens, but increasingly rarely.
| neilwilson wrote:
| How did you get the wad of cash in the first place and
| what is it?
|
| A wad of cash isn't money. It is nothing more than a
| receipt for a deposit held at an institution somewhere -
| that was created as an advance in the past in response to
| an equivalent loan.
|
| When you deposit a wad of cash in a bank, the bank takes
| ownership of the deposit in the institution and creates a
| new deposit in the bank for you. It's just another loan
| creating a deposit.
| threatripper wrote:
| They must only borrow the money (or get it from somebody
| else who got it from somebody who borrowed it from the
| central bank) that they need to pay you out in paper or
| digital cash and the money they have to keep in reserve.
| They do not have to borrow the whole credit value. The
| credit itself is created out of thin air but with some
| strings attached, so banks can't just create infinite
| amounts of credit and they cannot just pay out arbitrary
| sums of created credit. (Source: Some books I read a long
| time ago.)
| robertlagrant wrote:
| > The credit itself is created out of thin air but with
| some strings attached
|
| Yes - via the central bank, right? I thought that was how
| quantitative easing worked.
| spiralx wrote:
| QE is a separate process from the usual act of money
| creation by banks making loans, it's best to consider it
| as an out-of-the-ordinary manual intervention by the
| central bank where they create new central bank money ad
| hoc and use that to purchase assets on the market. The
| normal process of money creation is banks creating new
| commercial bank money when making loans to individuals
| and companies.
|
| https://www.bankofengland.co.uk/-/media/boe/files/quarter
| ly-...
| nvy wrote:
| >They still have to borrow the money from the central bank.
| Fractional reserves mean that the credited account's bank
| must deposit a portion of the money bank at central bank.
|
| Absolutely false. For starters, in many jurisdictions
| including the US, the reserve fraction is now 0% and has
| been for quite some time.
|
| https://www.bankofengland.co.uk/quarterly-
| bulletin/2014/q1/m...
| littlestymaar wrote:
| This isn't contradicting the GP's point: money is created by
| private banks, but they still create "United States dollar"
| that get a significant part of their value from the US
| government's ability to enforce taxes.
| imtringued wrote:
| The bank acts as an intermediary, but not the way economists
| tell you. They say that the bank is an intermediary of
| loanable funds between debtor and creditor. That is, money
| exists outside the system and the bank is just efficiently
| distributing it, kind of like eBay.
|
| Except the bank is an intermediary of a completely different
| kind between creditor and lender. What the bank does is
| aggregate illiquid credits and debts to create liquid credit
| and debt.
|
| You have a coupon that says you are owed X products by person
| A. Person B has a coupon that says he is owed Y by person C.
| The bank takes these coupons and transforms these illiquid
| promises into a liquid promise that lets you buy both X and Y
| products from person A and C. Think of it as a many to many
| relationship. The bank essentially acts as a blender that
| takes many things of non uniform quality and it produces a
| product of uniform quality.
|
| When you go to the bank and bring a stack of coupon that says
| "I will work for one hour for you" and the bank puts a stamp
| on the coupons that says "Bank B vouches for this coupon".
| Except this is inconvenient. What the bank does instead is
| print its own coupons that everyone recognizes and it
| deposits your coupons in its bank vaults. The bank writes
| down that you owe it all the coupons representing your labor
| time that you deposited as debt. Except this again is
| inconvenient, we can do away with the individual coupons
| entirely. Since paying your own coupon debt requires you to
| withdraw the coupons using bank coupons, we can just decide
| that you owe the debt in bank coupons instead.
| spiralx wrote:
| I think you're describing the difference between commercial
| bank money and central bank money, but I'm not sure.
| [deleted]
| WalterBright wrote:
| May I present HAMURABI:
|
| https://www.atariarchives.org/basicgames/showpage.php?page=7...
|
| I had a lot of fun playing and modifying that game. Learned a lot
| about programming with it.
| tnecniv wrote:
| Was not expecting to see an Atari game produced in my home town
| today
| 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
| JellyBeanThief wrote:
| I just love whenever the roundworld equivalent of something I
| first encountered on the discworld pops up in front of me.
| tenkabuto wrote:
| :D It goes both ways! Having known about it prior, it was
| very exciting to read about it in Discworld.
| [deleted]
| _the_inflator wrote:
| Vividness has its advantages. You could call it a simulator as
| well as one of the world's first dashboards as well.
| 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.
| WillPostForFood wrote:
| I'd go the other way, behavioral economics ought to be
| shelved for good. Classic econ should come back, but with a
| stamp on its forehead that is is not science or a practice.
|
| https://www.thebehavioralscientist.com/articles/the-death-
| of...
| dclowd9901 wrote:
| So what, we have no ground truth about economics? Is it
| just a close cousin of psychology?
| jmopp wrote:
| Economics sits at that intersection between the social
| sciences and the exact sciences: you can get some useful
| quantitative predictions out of it, but that is
| discounted by the fact that people are messy, and become
| even messier where money is concerned.
| goblin89 wrote:
| Economy is not that different from psychology, physics,
| or indeed any natural science. All try to predict how
| they would change depending on various factors and invent
| explanatory models that are never perfectly correct.
|
| It's just that some have had more apparent prediction
| success than others (non-coincidentally, it's those that
| don't directly involve humans as subjects), while some
| are liable to affect people's lives in more direct and
| drastic ways (non-coincidentally, it's those that do
| directly involve humans as subjects).
| dboreham wrote:
| Economics _is_ bulk effect Psychology.
| rsrsrs86 wrote:
| Both have been shelved; the state of the art in economic
| modeling is far, far more sophisticated. It goes way beyond
| the limitations of economics' loan from XIX century physics
| (static mechanics).
|
| Economic modeling based on game theory with extensions (say,
| requiring that certain agent choices are computable and are
| so under a limited computational budget, or non determinism,
| or learning) you still get sensible results under much weaker
| hypothesis.
| 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
| barrysteve wrote:
| But a massive precise map is the perfect seed for a useful
| simplified map.
|
| Simplifying from a non-complex source is a waste of time.
| JoeyBananas wrote:
| I have also implemented greedy algorithms.
| 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.
| rsrsrs86 wrote:
| This is cute but very different from what an economist would
| consider interesting.
| 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.
| Ruddle wrote:
| Thanks, and agreed. How ironic though, working on that fantasy
| is near certainly not economically viable. This blog post is
| merely procrastination that preempted job seeking.
| 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.
| 0cf8612b2e1e wrote:
| Eve Online? They even used to employ an economist to monitor
| the state of the game.
| theptip wrote:
| Not really a "simulator" since it's driven by real humans
| interacting. I'd say it's just a virtual world with its own
| real economy.
|
| An interesting thing you can do with a simulator is pause,
| rewind, make arbitrary experiments, run counterfactuals, etc
| -- all of which are prohibited in Eve since it needs to
| respect the users who are there to have fun, not be test
| subjects.
| bavell wrote:
| Workers and resources: Soviet Republic is a super fun economic
| and transportation logistics sim that shines in "Realistic
| mode". Highly recommended for fans of the genre. Tiny bit like
| a hardcore version of City Skylines.
| 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...
| gsuuon wrote:
| Same. Dwarf fortress used to have an economy but they took it
| out. I tried to make something like this and burnt out, though
| I expect I'll pick it back up again at some point.
| londonReed wrote:
| I believe that the economy aspect is going to be (eventually)
| re-worked entirely for a better simulation and to interact
| better with the existing game. The current development arc is
| going on several years at this point, so who knows when that
| might get addressed.
| 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.
| spiralx wrote:
| There's Democracy:
|
| https://store.steampowered.com/app/1410710/Democracy_4/
| js8 wrote:
| First, I really appreciate author trying to understand economy
| better in this way, even though this simulation is quite naive. I
| think everybody should do that.
|
| But as others have noted, it has no concept of capital, private
| property, and labor market. Therefore, it's not capitalism. It's
| not anarchism or communism either - it lacks flexibility of
| workers to do something else, or state planning telling workers
| to do something else. At best, it could be a model of a feudal
| society (where the "state servants" are the landed nobility).
|
| Furthermore, it has no concept of natural resources, energy,
| labor and goods. That has to be there before we even get to
| things like money.
|
| Also, the money definition is problematic. Money is essentially a
| contract, and can be created even between three private parties
| as resoldable bonds. This isn't there.
|
| I would also suggest, if the author (or anybody else) is
| interested, look at Steve Keen's work in economic simulation and
| his Minsky program. This guy is far ahead of everybody else in
| actually trying to understand how real economies work.
|
| To people who wonder why don't we have good economy simulators
| that would reflect a real world. Well, I think the answer is
| pretty simple - rich people don't want that. They don't want
| plebes to understand what it means to be rich, most rich people
| know they wealth is undeserved, and don't want other people to
| see it flaunted openly. So they prefer hegemony (in Gramsci
| terms) of neoliberal economics, which is misleading about what is
| happening in reality.
| xpe wrote:
| > To people who wonder why don't we have good economy
| simulators that would reflect a real world. Well, I think the
| answer is pretty simple - rich people don't want that.
|
| The comment above is an example of an _explanatory_ theory [1]
|
| > An explanatory analysis will try not only to describe the
| information but also to provide causal relationships between
| the various data presented.
|
| Simple, yes, but also too _simplistic_. It isn 't very
| persuasive. For the theory to be useful, then "rich people not
| wanting that" would have to be causally relevant. The comment
| above only provides an implied _incentive_ (e.g. rich people
| would benefit by preventing knowledge dissemination that
| undermines their status). However, there is no convincing
| argumentation showing how such incentives play out, much less
| that they are significant enough to be causally important.
|
| I don't want to reject the entirety of what the commentor above
| might be trying to say. There are probably aspects that are
| interesting, surprising, or maybe even troubling. Perhaps there
| have been documented cases of influential elites shaping
| economic theories and how they get communicated. Maybe; I
| haven't studied the _history_ of bias in the field of economics
| per se. I know of many biases, but so far I 've tended to think
| about them as being largely intellectual oversimplifications
| rather than _designed_ misdirections.
|
| Let's look to some other 'simple' explanations. One competing
| theory would be that economists and modelers want to earn
| status and earn a living. There doesn't have to be any
| malicious nor coordinated action to explain such behavior.
| There are many levels of systemic behavior that _align_ with
| powerful interests without any causal chain. This is sometimes
| referred to as co-evolution or co-adaptation.
|
| I _do_ want to reject the whole family of (not so good)
| explanatory theories that fail to give sufficient argumentation
| for causality.
|
| [1] https://philosophy.stackexchange.com/questions/30827/what-
| is...
| kamel3d wrote:
| Would rich people be able to stop you from creating a good
| economy simulator? At the end of the day, it's programming.
| Someone who has studied economics could make that without rich
| people coming after him. I argue that no one would come after
| you if you were to do so.
| js8 wrote:
| Yeah, but you also need to compare it with real world data.
| Without grounding, the simulation will be very limited.
|
| So you need to understand the real-world monetary flows to a
| sufficient level of detail. You need to understand who
| actually owns what, and how the power is exerted. And the
| rich people are against that, for example, in most developed
| countries (with IIRC notable exception of Norway and Sweden)
| the tax fillings are private.
|
| Also, it's kind of difficult to understand actual production,
| because private companies keep the data on production costs
| secret.
|
| On top of that, there is little culture of data sharing in
| economics profession. Again, mostly because the data are very
| valuable to companies and individuals, profit takes
| precedence to public understanding.
|
| So the fact of the matter is, lot of powerful people (and
| perhaps most middle class as well) don't want the level of
| transparency required to build a meaningful model.
|
| It's true that nobody will come after you if you try to
| program it. But also, you won't get much support from the
| existing, mostly neoliberal, institutions.
| wildrhythms wrote:
| Yes because a rich person demands I pay them money for
| housing, which among other things I need to survive, and my
| precious programming time is spent under a different rich
| person to get that money.
| 01100011 wrote:
| > rich people don't want that
|
| You had a great comment until you went off the rails. Sadly,
| economic ignorance is much more easily explained by apathy and
| the rarity of systems level thought in the general population.
| js8 wrote:
| That wouldn't be a problem, just look at climate science, it
| has decent models of very complicated systems, grounded in
| real-world understanding. But it requires lot of data to be
| collected and made available for people who do these
| simulations.
| stevenjgarner wrote:
| So if you feel that way, why not program your own model
| introducing the "concept of capital, private property, and
| labor market"?
| js8 wrote:
| Honestly, I'd love to, it's on my list. I really like what
| Steve Keen is doing. But I am currently amusing myself with a
| math problem, and that's more important.
| tomcam wrote:
| > rich people don't want that
|
| Where does this sentiment come from? And what do you define as
| rich? I have been acquainted with rich people for decades now
| and many of them seem pretty darn open to me.
| 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.
| theptip wrote:
| Another part of the challenge is overtime -- it ends up
| costing a lot to pay out time-and-a-half on an already
| fat paycheck. I think we should figure out some binding
| pre-commitment to forbid or at least minimize regular
| overtime. Something like "if > 50% of one employee's
| worth of overtime is required a new role must be opened
| instead of paying overtime".
|
| I understand that unions like OT for their members (of
| course they would!) but as an employer it's insane to be
| handing it out as regularly as government employees get
| it.
| idontpost wrote:
| [dead]
| OkayPhysicist wrote:
| These waterfront lifeguards have a lot more in common
| with EMTs and firefighters than have with the teenager
| who watches septagenarians do laps at your local pool,
| and they're compensated as such.
|
| No CEO or programmer dies in the line of duty, yet you
| can't throw a rock on this site without hitting thkse
| kinds of compensation.
| NotSuspicious wrote:
| Exactly, the average techbro's output working at a FAANG
| company likely ruins more lives than the average
| lifeguard saves. The compensation is clearly just.
| mindslight wrote:
| More like bankers everywhere.
| 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.
| neilwilson wrote:
| Another +1 from me.
|
| For me I'm particularly interested in how you've done the
| presentation interface.
| context86 wrote:
| [dead]
| 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.
| LeonB wrote:
| Yes please! Fantastic work by the way.
|
| I'd love to see the code with a permissive license for others
| to build upon.
|
| Reminds me a little of ncase's fantastic simulations -- for
| example: https://ncase.me/sim/
| 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.
| context86 wrote:
| [dead]
| smitty1e wrote:
| The "good" news is that gravity hates the Tower of Babel that
| every society inevitably produces.
| jeezfrk wrote:
| No. Gravity and a flat surface doesn't exist in money-power.
|
| It is buoyancy. It lifts few people up very high as they push
| down more that go down under the waves.
| vkou wrote:
| The "bad" news is that this kind of gravity tends to get
| called things like "The Reign of Terror".
| smitty1e wrote:
| No, no: the jackwagons atop the Tower engage in the reign
| of terror.
|
| The gravity at work here is economics, as seen through the
| lens of people. People, it turns out, don't flourish in
| captivity.
| vkou wrote:
| People don't flourish when most of their productive
| output is sucked up by some neo-feudal lord, either.
|
| For some reason, capital is currently consolidating at
| the top.
| smitty1e wrote:
| And those at the top pander to the bottom for power with
| public money.
|
| Disadvantage: the kulaks.
| rsrsrs86 wrote:
| One way to make this realistic is to add game theory to the
| simulation. Otherwise, the most important assumption in economics
| will be left out: rationality in decision making.
| Galanwe wrote:
| I don't think the objective is realism here, but rather
| education.
|
| Also, I'm not convinced "rationality" is key in reaching
| realism.
| Draiken wrote:
| > even though we made public servants numerous and quite rich in
| the process. This is a communist dream.
|
| Aside from this nonsense remark, it was an entertaining post.
|
| We should have one that's more based on incentives instead.
| Separate people from companies, create labor and make companies
| only care about profits at all cost.
|
| Finally, add a finite amount of resources and let's play it out.
| kamel3d wrote:
| In this day and age of AI, I think it's worth trying to build a
| better economy simulator without having any existing economic
| models in mind. Addressing this from a programming point of view
| could lead to interesting results.
| rsrsrs86 wrote:
| That has been done uncountable times...
|
| It's just really hard to get precise predictions. Really hard.
| Not like settling P=NO hard, but like moto perpetuo hard.
| Galanwe wrote:
| That's more or less what every quantitative hedge fund out
| there is doing.
| rsrsrs86 wrote:
| With no reports of funds consistently beating the market in a
| surprising way.
|
| There's no consistent way to make money. You can exploit
| small details about how each market works, but in a short
| time everyone will notice and copy you. It's like a market
| without patents. People talk, the trade ideas spread. Like
| wildfire. Too fast even for a quant to make sense - good
| managers can tell if a piece of info is hot. No manager will
| ever be able to tell whether a stock will outperform.
| Galanwe wrote:
| Wow, you have to be the super expert that unveiled the
| whole hedge fund scam. Thanks for your enlightening
| opinion.
| wordpad25 wrote:
| It's a common misconception about hedge funds that
| objective is to outperform market.
|
| The objective is to maximize profit per unit of risk taken.
| If hedge fund made 20% less than market but took 50% less
| risk, that's a MASSIVE value proposition.
|
| (now, one could argue they fail at that too, but that's
| more difficult to prove)
| [deleted]
| bwestergard wrote:
| This is super cool, but it models a non-capitalist economy, akin
| to the Rawlsian "property owning democracy".
|
| There is no accounting for capital goods. Interest in terms of
| numeraire is modeled in an internally coherent way, but this is
| not reflective of how distributional struggles between owners of
| means of production and workers play out (or, to be precise,
| among agents whose property ownership levels are not unimodal,
| which is the inevitable result of capitalist social relations).
|
| The distinctive characteristic of a capitalist economy is that
| the direct producers are separated from their means of
| production, such that they must sell their ability to work to
| those who own said means. Throughout the modern period, there has
| been a strong desire to have a market economy without this
| separation into classes.
|
| Without capital and wage labor, the author's assumption that
| terms of exchange are determined by producer/consumer preferences
| (their "quality of life" function). But in reality world
| capitalist economies, the capital relation instead constrains
| behavior to ensure the endless expansion of capital (the so-
| called "valorization imperative").
|
| It is important to note that a society with produced means of
| production, which are commonly referred to as "capital goods" or
| "producer goods", need not be a capitalist society in principle.
|
| On a completely different note, at first glance it seems that
| this model could be expressed as a convex program, possibly even
| a linear program?
| JoshMBN wrote:
| I'm currently in my second year of my Bach degree for Information
| Technology and I have had this exact same idea but never really
| knew how to go about it. But I think I might attempt it next year
| during my A.I. and Data Science paper. Just as proof of concept
| for neural network practice and learning.
| keithalewis wrote:
| https://www.nobelprize.org/prizes/economic-sciences/1973/leo...
| His ideas might finally become practical to implement. Then
| again, von Neumann thought weather prediction would be solved in
| short order after the invention of the computer.
| stephen_g wrote:
| If you _actually_ want to simulate an economy, the answer is
| complex dynamic systems. Traditional static equilibrium models
| (like Computational General Equilibrium (CGE) or the not actually
| very dynamic Dynamic Stochastic General Equlibrium (DSGE) models)
| are pretty useless (they have all these 'nudging' variables to
| try and push things towards reality but the actual underlying
| methodology is bunk).
|
| Even weather forecasting moved to dynamical systems models
| decades ago, economics still hasn't caught up.
| Calamitous wrote:
| I did not expect to read through and run every simulation. But I
| did.
| Ruddle wrote:
| The symmetry is nice. I did not expect to write, or code most
| of it. We were both taken by serendipity.
| jfantl wrote:
| I did something similar, but started somewhere different: The
| individuals personal value of a good. You might find it
| interesting as a different approach to a similar project.
| https://jasonfantl.com/posts/Simulated-Economy-(1)/
| algas wrote:
| Great series! I liked your addition of inter-process
| communication, and the last one was a treat.
| 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]
| nayuki wrote:
| The dynamic price simulation reminds me of Primer (
| https://www.youtube.com/@PrimerBlobs/videos ), specifically:
| https://www.youtube.com/watch?v=PNtKXWNKGN8
___________________________________________________________________
(page generated 2023-09-16 23:02 UTC)