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Hercules — A modeling system with knowledge about economics

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The paper is concerned with the effectiveness of economic modeling. It argues that the key problems of economic modeling are the time and effort it takes to implement a model, the problems of detecting and correcting errors, and the difficulties involved in communicating assumptions. The logical consequence is to improve the model representation and the error detection capabilities of modeling systems. The paper discusses information content and error detection in models that use conventional mathematical notation and argues that we need a model representation with more information than is usually available in mathematical representations. HERCULES, a modeling systems for large economywide static models is then presented. The system uses a model representation in which all economic assumptions are directly available. This makes model implementation much faster and prevents certain types of errors. In other cases, error detection and error messages are far superior to those of general purpose mathematical modeling systems. The technical implementation of HERCULES, designed to allow maximum flexibility for future enhancements is discussed.

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Drud, A. Hercules — A modeling system with knowledge about economics. Computer Science in Economics and Management 2, 83–99 (1989). https://doi.org/10.1007/BF00454706

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Key words

  • Modeling system
  • model implementation
  • knowledge based system
  • error detection
  • economics