Advertisement

Journal of Evolutionary Economics

, Volume 29, Issue 1, pp 1–37 | Cite as

More is different ... and complex! the case for agent-based macroeconomics

  • Giovanni DosiEmail author
  • Andrea Roventini
Regular Article

Abstract

This work nests the Agent-Based macroeconomic perspective into the earlier history of macroeconomics. We discuss how the discipline in the 70’s took a perverse path relying on models grounded on fictitious rational representative agent in order to try to pathetically circumvent aggregation and coordination problems. The Great Recession was a natural experiment for macroeconomics, showing the inadequacy of the predominant theoretical framework grounded on DSGE models. After discussing the pathological fallacies of the DSGE-based approach, we claim that macroeconomics should consider the economy as a complex evolving system, i.e. as an ecology populated by heterogenous agents, whose far-from-equilibrium interactions continuously change the structure of the system. This in turn implies that more is different: macroeconomics cannot be shrink to representative-agent micro, but agents’ complex interactions lead to emergence of new phenomena and hierarchical structure at the macro level. This is what is taken into account by agent-based models, which provide a novel way to model complex economies from the bottom-up, with sound empirically-based microfoundations. We present the foundations of Agent-Based macroeconomics and we discuss how the contributions of this special issue push its frontier forward. Finally, we conclude by discussing the ways ahead for the fully acknowledgement of agent-based models as the standard way of theorizing in macroeconomics.

Keywords

Macroeconomics Economic policy Keynesian theory New neoclassical synthesis New Keynesian models DSGE models Agent-based evolutionary models Complexity theory Great recession Crisis 

JEL Classification

B41 B50 E32 E52 

Notes

Acknowledgments

Thanks to Giorgio Fagiolo, Mattia Guerini, Francesco Lamperti, Alessio Moneta, Maria Enrica Virgillito. All usual disclaimers apply. This study was funded by European Union’s Horizon 2020 grants: No. 649186 - Project ISIGrowth. The authors declare that they have no conflict of interest.

References

  1. Aghion P, Howitt P (1992) A model of growth through creative destruction. Econometrica 60:323–351Google Scholar
  2. Akerlof GA (2002) Behavioral macroeconomics and macroeconomic behavior. Am Econ Rev 92:411–433Google Scholar
  3. Akerlof GA (2007) The missing motivation in macroeconomics. Am Econ Rev 97:5–36Google Scholar
  4. Akerlof GA, Shiller RJ (2009) Animal spirits: how human psychology drives the economy, and why it matters for global capitalism. Princeton University Press, PrincetonGoogle Scholar
  5. Akerlof GA, Yellen JL (1985) A near-rational model of the business cycles, with wage and price inertia. Q J Econ 100:823–838Google Scholar
  6. Albert R, Barabasi AL (2002) Statistical mechanics of complex networks. Rev Mod Phys 4:47–97Google Scholar
  7. Alfarano S, Lux T, Wagner F (2005) Estimation of agent-based models: the case of an asymmetric herding model. Comput Econ 26:19–49Google Scholar
  8. Anderson PW (1972) More is different. Science 177 (4047):393–396. http://www.jstor.org/stable/1734697 Google Scholar
  9. Anufriev M, Assenza T, Hommes C, Massaro D (2013) Interest rate rules and macroeconomic stability under heterogeneous expectations. Macroecon Dyn 17(08):1574–1604. https://ideas.repec.org/a/cup/macdyn/v17y2013i08p1574-1604_00.html Google Scholar
  10. Anufriev M, Bao T, Tuinstra J (2016) Microfoundations for switching behavior in heterogeneous agent models: an experiment. J Econ Behav Organ 129 (C):74–99.  https://doi.org/10.1016/j.jebo.2016.06.00. https://ideas.repec.org/a/eee/jeborg/v129y2016icp74-99.html Google Scholar
  11. Arifovic J (2019) Evolution of sunspot like behavior in the agent based economies of bank runs. J Evol EconGoogle Scholar
  12. Ascari G, Ropele T (2009) Trend inflation, Taylor principle, and indeterminacy. J Money Credit Bank 41:1557–1584Google Scholar
  13. Ascari G, Fagiolo G, Roventini A (2015) Fat-tails distributions and business-cycle models. Macroecon Dyn 19:465–476Google Scholar
  14. Assenza T, Delli Gatti D (2013) E pluribus unum: macroeconomic modelling for multi-agent economies. J Econ Dyn Control 37(8):1659–1682Google Scholar
  15. Assenza T, Delli Gatti D (2019) The financial transmission of shocks in a simple hybrid macroeconomic agent based model. J Evol Econ.  https://doi.org/10.1007/s00191-018-0559-3
  16. Atkinson AB, Piketty T, Saez E (2011) Top incomes in the long run of history. J Econ Lit 49:3–71Google Scholar
  17. Bak P, Chen K, Scheinkman JA, Woodford M (1992) Aggregate fluctuations from indipendent sectoral shocks: self-organize criticality. Working Paper 4241, NBERGoogle Scholar
  18. Baptista R, Farmer DJ, Hinterschweiger M, Low K, Tang D, Uluc A (2016) Macroprudential policy in an agent-based model of the UK housing market. Staff Working Paper 619, Bank of EnglandGoogle Scholar
  19. Barde S (2016) A practical, accurate, information criterion for nth order Markov processes. Comput Econ 50:1–44Google Scholar
  20. Bargigli L, Riccetti L, Russo A, Gallegati M (2016) Network calibration and metamodeling of a financial accelerator agent based model. Working Papers - Economics 2016/01, Universita degli Studi di Firenze, Dipartimento di Scienze per lEconomia e lImpresaGoogle Scholar
  21. Battiston S, Farmer DJ, Flache A, Garlaschelli D, Haldane A, Heesterbeeck H, Hommes C, Jaeger C, May R, Scheffer M (2016) Complexity theory and financial regulation. Science 351:818–819Google Scholar
  22. Benhabib J, Schmitt-Grohé S, Uribe M (2001) The perils of Taylor rules. J Econ Theory 96:40–69Google Scholar
  23. Bernanke B, Gertler M, Gilchrist S (1999) The financial accelerator in a quantitative business cycle framework. In: Taylor J, Woodford M (eds) Handbook of macroeconomics. Elsevier Science, AmsterdamGoogle Scholar
  24. Bernanke BS (2002) On Milton Friedman’s ninetieth birthday. In: Conference to honor Milton FriedmanGoogle Scholar
  25. Beyer A, Farmer REA (2004) On the indeterminacy of New-Keynesian economics. Working Paper Series No. 323, European Central Bank, Frankfurt, GermanyGoogle Scholar
  26. Bloomquist KM, Koehler M (2015) A large-scale agent-based model of taxpayer reporting compliance. J Artif Soc Social Simul 18(2):20.  https://doi.org/10.18564/jasss.2621. http://jasss.soc.surrey.ac.uk/18/2/20.html Google Scholar
  27. Bookstaber R (2017) The end of theory: financial crises, the failure of economics, and the sweep of human interaction. Princeton University Press, PrincetonGoogle Scholar
  28. Bookstaber R, Paddrik M (2015) An agent-based model for crisis liquidity dynamics. Working Paper 15-18, OFRGoogle Scholar
  29. Branch WA, McGough B (2011) Monetary policy and heterogeneous agents. Econ Theory 47:365–393Google Scholar
  30. Braun-Munzinger K, Liu Z, Turrell A (2016) An agent-based model of dynamics in corporate bond trading. Staff Working Paper 592, Bank of EnglandGoogle Scholar
  31. Brock WA, Durlauf SN (2001) Interactions-based models. In: Heckman J, Leamer E (eds) Handbook of econometrics. North Holland, AmsterdamGoogle Scholar
  32. Brock WA, Hommes C (1997) A rational route to randomness. Econometrica 65:1059–1095Google Scholar
  33. Brock WA, Durlauf S, Nason JM, Rondina G (2007) Simple versus optimal rules as guides to policy. J Monet Econ 54:1372–1396Google Scholar
  34. Caballero RJ (2010) Macroeconomics after the crisis: time to deal with the pretense-of-knowledge syndrome. J Econ Perspect 24:85–102Google Scholar
  35. Caiani A, Godin A, Caverzasi E, Gallegati M, Kinsella S, Stiglitz J (2016) Agent based-stock flow consistent macroeconomics: towards a benchmark model. J Econ Dyn Control 69:375–408Google Scholar
  36. Caiani A, Russo A, Gallegati M (2019) Does inequality Hamper innovation and growth? an ab-sfc analysis. J Evol Econ.  https://doi.org/10.1007/s00191-018-0554-8
  37. Canova F (2008) How much structure in empirical models? In: Mills T, Patterson K (eds) Palgrave handbook of econometrics, vol 2, applied econometrics. Palgrave Macmillan, BasingstokeGoogle Scholar
  38. Canova F, Sala L (2009) Back to square one: identification issues in dsge models. J Monet Econ 56:431–449Google Scholar
  39. Canzoneri M, Collard F, Dellas H, Diba B (2016) Fiscal multipliers in recessions. Econ J 126:75–108Google Scholar
  40. Cassidy J (2009) How markets fail. Allen Lane, London/New YorkGoogle Scholar
  41. Caverzasi E, Russo A (2018) Toward a new microfounded macroeconomics in the wake of the crisis. LEM Working Papers Series 2018/23, Scuola Superiore Sant’AnnaGoogle Scholar
  42. Chan-Lau JA (2017) Abba: an agent-based model of the banking system. IMF Working Paper 17/136Google Scholar
  43. Chari VV, Kehoe PJ, ME R (2009) New Keynesian models are not yet useful for policy analysis. Am Econ J Macroecon 1:242–266Google Scholar
  44. Christiano LG, Motto R, Rostagno M (2013) Risk shocks. Am Econ Rev 104:27–65Google Scholar
  45. Ciarli T, Lorentz A, Savona M, Valente M (2010) The effect of consumption and production structure on growth and distribution. A micro to macro modelroduction structure on growth and distribution. A micro to macro model. Metroeconomica 61:180–218Google Scholar
  46. Ciarli T, Lorentz A, Valente M, Savona M (2019) Structural changes and growth regimes. J Evol Econ.  https://doi.org/10.1007/s00191-018-0574-4
  47. Cincotti S, Raberto M, Teglio A (2010) Credit money and macroeconomic instability in the agent-based model and simulator eurace. Economics: the Open-Access, Open-Assessment E-Journal 4(2010-26)Google Scholar
  48. Clarida R, Galí J, Gertler M (1999) The science of monetary policy: a new Keynesian perspective. J Econ Lit 37:1661–1707Google Scholar
  49. Cogley T, Nason JM (1993) Impulse dynamics and propagation mechanisms in a real business cycle model. Econ Lett 43:77–81Google Scholar
  50. Coibion O, Gorodnichenko Y (2015) Information rigidity and the expectations formation process: a simple framework and new facts. Am Econ Rev 105:2644–2678Google Scholar
  51. Colander D, Folmer H, Haas A, Goldberg MD, Juselius K, Kirman AP, Lux T, Sloth B (2009) The financial crisis and the systemic failure of academic economics. Tech. rep., 98th Dahlem WorkshopGoogle Scholar
  52. Cooper RW, John A (1988) Coordinating coordination failures in Keynesian models. Q J Econ 103:441–463Google Scholar
  53. Curdia V, Woodford M (2010) Credit spreads and monetary policy. J Money Credit Bank 42:3–35Google Scholar
  54. Curdia V, Woodford M (2011) The central-bank balance sheet as an instrument of monetary policy. J Monet Econ 58:54–79Google Scholar
  55. Curdia V, Woodford M (2015) Credit frictions and optimal monetary policy. NBER Working paper 21820, National Bureau of Economic ResearchGoogle Scholar
  56. Curdia V, Del Negro M, Greenwald D (2014) Rare shocks, great recessions. J Appl Econom 29:1031–1052Google Scholar
  57. Cyert RM, March JG (1992) A behavioral theory of the firm, 2nd edn. Blackwell Business, OxfordGoogle Scholar
  58. Da Silva MA, Tadeu Lima G (2015) Combining monetary policy and prudential regulation: an agent-based modeling approach. Working paper 394, Banco Central do BrasilGoogle Scholar
  59. Dawid H, Delli Gatti D (2018) Agent-based macroeconomics. In: Hommes C, LeBaron B (eds) Handbook of computational economics, vol IV. ElsevierGoogle Scholar
  60. Dawid H, Gemkow S, Harting P, Neugart M (2012) Labor market integration policies and the convergence of regions: the role of skills and technology diffusion. J Evol Econ 22:543–562Google Scholar
  61. Dawid H, Harting P, Neugart M (2014) Economic convergence: policy implications from a heterogeneous agent model. J Econ Dyn Control 44:54–80Google Scholar
  62. Dawid H, Harting P, Neugart M (2018a) Cohesion policy and inequality dynamics: insights from a heterogeneous agents macroeconomic model. J Econ Behav Organ 150:220–255Google Scholar
  63. Dawid H, Harting P, Neugart M (2018b) Fiscal transfers and regional economic growth. Rev Int Econ 26:651–671Google Scholar
  64. Dawid H, Harting P, van der Hoog S, Neugart M (2019) Macroeconomics with heterogeneous agent models: fostering transparency, reproducibility and replication. J Evol EconGoogle Scholar
  65. De Grauwe P (2012) Booms and busts in economic activity: a behavioral explanation. J Econ Behav Organ 83:484–501Google Scholar
  66. De Long JB (2000) The triumph of monetarism? J Econ Perspect 14:83–94Google Scholar
  67. Debreu G (1974) Excess demand function. J Math Econ 1:15–23Google Scholar
  68. Dilaver O, Jump R, Levine P (2018) Agent-based macroeconomics and dynamic stochastic general equilibrium models: where do we go from here? J Econ Surv 32:1134–1159Google Scholar
  69. Domar ED (1946) Capital expansion, rate of growth, and employment. Econometrica 14:137–47Google Scholar
  70. Dos Santos T, Nakane M (2017) Dynamic bank runs: an agent-based approach. Working Paper 465, Banco Central do BrasilGoogle Scholar
  71. Dosi G (2012a) Economic coordination and dynamics: some elements of an alternative “evolutionary” paradigm. LEM Working Papers Series 2012/08, Scuola Superiore Sant’AnnaGoogle Scholar
  72. Dosi G (2012b) Economic organization, industrial dynamics and development. Edward Elgar, Cheltenham. chap IntroductionGoogle Scholar
  73. Dosi G, Roventini A (2016) The irresistible fetish of utility theory: From “pleasure and pain” to rationalising torture. Intereconomics 51:286–287Google Scholar
  74. Dosi G, Roventini A (2017) Agent-based macroeconomics and classical political economy: Some Italian roots. Italian Economic Journal: a Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti 3(3):261–283Google Scholar
  75. Dosi G, Virgillito ME (2017) In order to stand up you must keep cycling: Change and coordination in complex evolving economies. Struct Chang Econ DynGoogle Scholar
  76. Dosi G, Winter SG (2002) Interpreting economic change: evolution, structures and games. In: Augier M, March J (eds) The economics of choice, change, and organizations. Cheltenham, Edward Elgar PublishersGoogle Scholar
  77. Dosi G, Fagiolo G, Roventini A (2010) Schumpeter meeting Keynes: a policy-friendly model of endogenous growth and business cycles. J Econ Dyn Control 34:1748–1767Google Scholar
  78. Dosi G, Fagiolo G, Napoletano M, Roventini A (2013) Income distribution, credit and fiscal policies in an agent-based Keynesian model. J Econ Dyn Control 37:1598–1625Google Scholar
  79. Dosi G, Fagiolo G, Napoletano M, Roventini A, Treibich T (2015a) Fiscal and monetary policies in complex evolving economies. J Econ Dyn Control 52 (2014/22):166–189Google Scholar
  80. Dosi G, Sodini M, Virgillito ME (2015b) Profit-driven and demand-driven investment growth and fluctuations in different accumulation regimes. J Evol Econ 25:707–728Google Scholar
  81. Dosi G, Napoletano M, Roventini A, Treibich T (2016a) Micro and macro policies in Keynes+Schumpeter evolutionary models. J Evol Econ 27:63–90Google Scholar
  82. Dosi G, Napoletano M, Roventini A, Treibich T (2016b) The short- and long-run damages of fiscal austerity: Keynes beyond Schumpeter. In: Stiglitz J, Guzman M (eds) Contemporary issues in macroeconomics. Palgrave Macmillan, UKGoogle Scholar
  83. Dosi G, Napoletano M, Roventini A, Stiglitz J, Treibich T (2017a) Rational heuristics? Expectations in complex, evolving economies with heterogeneous, interacting agents. Working Paper Series 2017/31, Laboratory of Economics and Management (LEM), Scuola Superiore SantAnna, Pisa, ItalyGoogle Scholar
  84. Dosi G, Pereira MC, Roventini A, Virgillito ME (2017b) When more flexibility yields more fragility: the microfoundations of Keynesian aggregate unemployment. J Econ Dyn Control 81:162–186Google Scholar
  85. Dosi G, Pereira MC, Roventini A, Virgillito ME (2017c) The effects of labour market reforms upon unemployment and income inequalities: an agent based model. Soc Econ Rev 16:687–720Google Scholar
  86. Dosi G, Pereira MC, Virgillito ME (2017d) On the robustness of the fat-tailed distribution of firm growth rates: a global sensitivity analysis. J Econ Interac Coord 13:173–193Google Scholar
  87. Dosi G, Faillo M, Marengo L (2018a) Beyond “bounded rationality”: behaviours and learning in complex evolving worlds. LEM Working Papers Series 2018/26, Scuola Superiore Sant’AnnaGoogle Scholar
  88. Dosi G, Pereira M, Roventini A, Virgillito ME (2018b) The labour-augmented K+S model: a laboratory for the analysis of institutional and policy regimes. LEM Working Papers Series 2018/24, Scuola Superiore Sant’AnnaGoogle Scholar
  89. Dosi G, Pereira MC, Roventini A, Virgillito ME (2018c) Causes and consequences of hysteresis: Aggregate demand, productivity and employment. Ind Corp Chang 27:1015–1044Google Scholar
  90. Dosi G, Napoletano M, Roventini A, Treibich T (2019) Debunking the granular origins of aggregate fluctuations: from real business cycles back to Keynes. J Evol Econ.  https://doi.org/10.1007/s00191-018-0590-4
  91. Edelman GM, Gally JA (2001) Degeneracy and complexity in biological systems. Proc Natl Acad Sci 98:13763–13768Google Scholar
  92. Eggertsson GB, Krugman P (2012) Debt, deleveraging, and the liquidity trap: a fisher-minsky-koo approach. Q J Econ 127:1469–1513Google Scholar
  93. Evans GW, Honkapohja S (2001) Learning and expectations in macroeconomics. Princeton University Press, PrincetonGoogle Scholar
  94. Fagiolo G, Roventini A (2012) Macroeconomic policy in DSGE and agent-based models. Revue de l’OFCE 124:67–116Google Scholar
  95. Fagiolo G, Roventini A (2017) Macroeconomic policy in DSGE and agent-based models redux: new developments and challenges ahead. J Artif Soc Social Simul 20 (1):1Google Scholar
  96. Fagiolo G, Napoletano M, Roventini A (2008) Are output growth-rate distributions fat-tailed? some evidence from oecd countries. J Appl Econom 23:639–669Google Scholar
  97. Fagiolo G, Guerini M, Lamperti F, Moneta A, Roventini A (2017) Validation of agent-based models in economics and finance. In: Beisbart C, Saam NJ (eds) Computer simulation validation. Fundamental concepts, methodological frameworks, philosophical perspectives. also available as Scuola Superiore Sant’Anna LEM Working Papers Series 2017/23. Springer International PublishingGoogle Scholar
  98. Farmer DJ, Foley D (2009) The economy needs agent-based modeling. Nature 460:685–686Google Scholar
  99. Favero C (2007) Model evaluation in macroeconometrics: from early empirical macroeconomic models to dsge models. Working Paper 327, IGIER, Bocconi University, Milan, ItalyGoogle Scholar
  100. Fernandez-Villaverde J, Levintal O (2016) Solution methods for models with rare disasters. Working Paper 21997, National Bureau of Economic ResearchGoogle Scholar
  101. Fitoussi J, Saraceno F (2010) Inequality and macroeconomi performance. Document de Travail 2010-13, OFCE, Science PoGoogle Scholar
  102. Fitoussi JP, Saraceno F (2013) European economic governance: the Berlin–Washington consensus. Camb J Econ 37:479–496Google Scholar
  103. Forni M, Lippi M (1997) Aggregation and the microfoundations of dynamic macroeconomics. Oxford University Press, OxfordGoogle Scholar
  104. Forni M, Lippi M (1999) Aggregation of linear dynamic microeconomic models. J Math Econ 31:131–158Google Scholar
  105. Friedman M (1968) The role of monetary policy. Am Econ Rev 58:1–17Google Scholar
  106. Fukac M, Pagan A (2006) Issues in adopting dsge models for use in the policy process. Working Paper 10/2006, CAMAGoogle Scholar
  107. Fukuyama F (1992) The end of history and the last man. Penguin, LondonGoogle Scholar
  108. Gabaix X (2011) The granular origins of aggregate fluctuations. Econometrica 79(3):733–772Google Scholar
  109. Gabaix X (2014) A sparsity-based model of bounded rationality*. Q J Econ 129(4):1661–1710.  https://doi.org/10.1093/qje/qju024 Google Scholar
  110. Galí J, Gertler M (2007) Macroeconomic modelling for monetary policy evaluation. J Econ Perspect 21:25–46Google Scholar
  111. Gennaioli N, Ma Y, Shleifer A (2015) Expectations and investment. NBER Working paper 21260, National Bureau of Economic ResearchGoogle Scholar
  112. Gertler M, Karadi P (2011) A model of unconventional monetary policy. J Monet Econ 58:17–34Google Scholar
  113. Gertler M, Kiyotaki N (2010) Financial intermediation and credit policy in business cycle analysis. In: Friedman BM, Woodford M (eds) Handbook of monetary economics. North Holland, AmsterdamGoogle Scholar
  114. Ghironi F (2018) Macro need micro. Oxf Rev Econ Policy 34:195–218Google Scholar
  115. Gigerenzer G (2007) Gut feelings the intelligence of the unconscious. Viking, New YorkGoogle Scholar
  116. Gigerenzer G, Brighton H (2009) Homo heuristicus: why biased minds make better inferences. Top Cogn Sci 1:107–143Google Scholar
  117. Goodfriend M (2007) How the world achieved consensus on monetary policy. J Econ Perspect 21:47–68Google Scholar
  118. Goodhart CAE (2009) The continuing muddles of monetary theory: a steadfast refusal to face facts. Economica 76:821–830Google Scholar
  119. Goodwin RM (1950) A nonlinear theory of the cycle. Rev Econ Stud 32:316–320Google Scholar
  120. Goodwin RM (1951) The nonlinear accelerator and the persistence of business cycles. Econometrica 19:1–17Google Scholar
  121. Grazzini J, Richiardi M (2015) Estimation of ergodic agent-based models by simulated minimum distance. J Econ Dyn Control Control 51(C):148–165. http://EconPapers.repec.org/RePEc:eee:dyncon:v:51:y:2015:i:c:p:148-165 Google Scholar
  122. Grazzini J, Richiardi M, Sellad L (2013) Indirect estimation of agent-based models. an application to a simple diffusion model. Complex Econ 2:25–40Google Scholar
  123. Grazzini J, Richiardi MG, Tsionas M (2017) Bayesian estimation of agent-based models. J Econ Dyn Control 77(C):26–47. http://ideas.repec.org/a/eee/dyncon/v77y2017icp26-47.html Google Scholar
  124. Greenwald B, Stiglitz J (1993a) Financial market imperfections and business cycles. Q J Econ 108:77–114Google Scholar
  125. Greenwald B, Stiglitz J (1993b) New and old Keynesians. J Econ Perspect 7:23–44Google Scholar
  126. Gualdi S, Mandel A (2019) Endogenous growth in production networks. J Evol Econ.  https://doi.org/10.1007/s00191-018-0552-x
  127. Guerini M, Moneta A (2017) A method for agent-based models validation. J Econ Dyn Control 82:125–141Google Scholar
  128. Hahn F (1991) The next hundred years. Econ J 101:47–50Google Scholar
  129. Halaj G (2018) Agent-based model of system-wide implications of funding risk. Working Paper Series 2121, European Central BankGoogle Scholar
  130. Haldane A (2012) The dog and the frisbee. Central Bankers Speeches, BISGoogle Scholar
  131. Haldane AG, Turrell AE (2019) Drawing on different disciplines: macroeconomic agent-based models. J Evol Econ.  https://doi.org/10.1007/s00191-018-0557-5
  132. Harcourt GC (2007) The structure of post-Keynesian economics. Hist Econ Rev 45:95–105Google Scholar
  133. Harcourt GC, Karmel PH, Wallace RH (1967) Economic activity. Cambridge University Press, CambridgeGoogle Scholar
  134. Harrod RF (1939) An essay in dynamic theory. Econ J 49:14–33Google Scholar
  135. Heckman J, Moktan S (2018) Publishing and promotion in economics: the tyranny of the top five. Working Paper 25093, NBERGoogle Scholar
  136. Hendry D, Minzon G (2010) On the mathematical basis of inter-temporal optimization. Economics Series Working Papers 497, University of OxfordGoogle Scholar
  137. Hicks JR (1937) Mr. Keynes and the “Classics”: a suggested interpretation. Econometrica 5:147–159Google Scholar
  138. Hommes C (2013) Behavioral rationality and heterogeneous expectations in complex economic systems. Cambridge University Press, CambridgeGoogle Scholar
  139. van der Hoog S, Dawid H (2017) Bubbles, crashes, and the financial cycle. The impact of banking regulation on deep recessions. Macroecon DynGoogle Scholar
  140. Hosszu S, Mero B (2017) An agent based Keynesian model with credit cycles and countercyclical capital buffer. MNB Workin Papers 5, Magyar Nemze BankGoogle Scholar
  141. Howitt P (2012) What have central bankers learned from modern macroeconomic theory? J Macroecon 34:11–22Google Scholar
  142. Johansen S (2006) Confronting the economic model with the data. In: Colander D (ed) Post Walrasian macroeconomics. Cambridge University Press, CambridgeGoogle Scholar
  143. Juselius K, Franchi M (2007) Taking a dsge model to the data meaningfully. Economics: the Open-Access, Open-Assessment E-Journal 1 (2007-4)Google Scholar
  144. Kaldor N (1957) A model of economic growth. Econ J 67(268):591–624. http://www.jstor.org/stable/2227704 Google Scholar
  145. Kaldor N (1982) The scourge of monetarism. Oxford University Press, LondonGoogle Scholar
  146. Kaplan G, Moll B, Violante GL (2018) Monetary policy according to hank. Am Econ Rev 108:697–743Google Scholar
  147. Kay J (2011) The map is not the territory: an essay on the state of economics. Tech. rep., Institute for New Economic ThinkingGoogle Scholar
  148. Keynes JM (1921) Treatise on probability. Macmillan and Co, LondonGoogle Scholar
  149. Keynes JM (1936) The general theory of employment, interest and money. Prometheus Books, New YorkGoogle Scholar
  150. Kirman AP (1989) The intrinsic limits of modern economic theory: the emperor has no clothes. Econ J 99:126–39Google Scholar
  151. Kirman AP (1992) Whom or what does the representative individual represent? J Econ Perspect 6:117–136Google Scholar
  152. Kirman AP (2010a) Complex economics individual and collective rationality. Routledge, LondonGoogle Scholar
  153. Kirman AP (2010b) The economic crisis is a crisis for economic theory. CESifo Econ Stud 56:498– 535Google Scholar
  154. Kirman AP (2014) Is it rational to have rational expectations? Mind and Society 13:29–48Google Scholar
  155. Kirman AP (2016) Ants and nonoptimal self-organization: lessons for macroeconomics. Macroecon Dyn 20:601–621Google Scholar
  156. Kirman AP, Vriend NJ (2001) Evolving market structure: an ace model of price dispersion and loyalty. J Econ Dyn Control 25 (3):459–502.  https://doi.org/10.1016/S0165-1889(00)00033-6. http://www.sciencedirect.com/science/article/pii/S0165188900000336, agent-based Computational Economics (ACE)Google Scholar
  157. Klamer A (1984) The new classical macroeconomics conversations with the new classical economists and their opponents. Wheatsheaf Books, BrightonGoogle Scholar
  158. Knight F (1921) Risk, uncertainty and profits. Chicago University Press, ChicagoGoogle Scholar
  159. Krugman P (2009) How did economics get it so wrong? N Y Times Mag (9):36–44Google Scholar
  160. Krugman P (2011) The profession and the crisis. East Econ J 37:307–312Google Scholar
  161. Kumhof M, Ranciere R, Winant P (2015) Inequality, leverage, and crises. Am Econ Rev 105:1217–45Google Scholar
  162. Kydland FE, Prescott EC (1982) Time to build and aggregate fluctuations. Econometrica 50:1345–70Google Scholar
  163. Lamperti F (2018) Empirical validation of simulated models through the gsl-div: an illustrative application. J Econ Interac Coord 13(1):143–171Google Scholar
  164. Lamperti F, Dosi G, Napoletano M, Roventini A, Sapio A (2018a) And then he wasn’t a she: climate change and green transitions in an agent-based integrated assessment model. LEM Working Papers Series 2018/14, Scuola Superiore Sant’AnnaGoogle Scholar
  165. Lamperti F, Dosi G, Napoletano M, Roventini A, Sapio A (2018b) Faraway, so close: coupled climate and economic dynamics in an agent-based integrated assessment model. Ecol Econ 150:315–339Google Scholar
  166. Lamperti F, Roventini A, Sani A (2018c) Agent-based model calibration using machine learning surrogates. J Econ Dyn Control 90:366–389Google Scholar
  167. Landes DS (1969) The unbound prometheus: technological change and industrial development in Western Europe from 1750 to the present. Cambridge University Press, CambridgeGoogle Scholar
  168. Lane DA (1993) Artificial worlds and economics, part i and ii. J Evol Econ 3:89–107 and 177–197Google Scholar
  169. Lavoie M (2009) Introduction to Post-Keynesian economics. Palgrave Macmillan, LondonGoogle Scholar
  170. Lavoie M, Stockhammer E (eds) (2013) Wage-led growth. Palgrave Macmillan, LondonGoogle Scholar
  171. LeBaron B, Tesfatsion L (2008) Modeling macroeconomies as open-ended dynamic systems of interacting agents. Am Econ Rev 98:246–250Google Scholar
  172. Leijonhufvud A (1968) On Keynesian economics and the economics of Keynes: a study in monetary theory. Oxford University Press, New YorkGoogle Scholar
  173. Leijonhufvud A (2000) Macroeconomic instability and coordination: selected essays. Edward Elgar, CheltenhamGoogle Scholar
  174. Lindé SF, Wouters R (2016) Challenges for central banks’ macro models. In: Taylor JB, Uhlig H (eds) Handbook of macroeconomics. North HollandGoogle Scholar
  175. Lorentz A, Ciarli T, Savona M, Valente M (2016) The effect of demand-driven structural transformations on growth and technological change. J Evol Econ 26:219–246Google Scholar
  176. Lucas REJ, Sargent TJ (1978) After Keynesian macroeconomics. In: After the Phillips curve: persistence of high inflation and high unemployment. Federal Reserve Bank of Boston, Boston, MAGoogle Scholar
  177. Mankiw GN, Romer D (eds) (1991) New Keynesian economics. MIT Press, CambridgeGoogle Scholar
  178. Mantel R (1974) On the characterization of aggregate excess demand. J Econ Theory 7:348–353Google Scholar
  179. Massaro D (2013) Heterogeneous expectations in monetary dsge models. J Econ Dyn Control 37:680–692Google Scholar
  180. Meijers H, Nomaler Ö, Verspagen B (2019) Demand, credit and macroeconomic dynamics. a micro simulation model. J Evol Econ.  https://doi.org/10.1007/s00191-018-0553-9
  181. Mishkin FS (2007) Will monetary policy become more of a science. Working Paper 13566, NBERGoogle Scholar
  182. Montagna M, Kok C (2016) Multi-layered interbank model for assessing systemic risk. Working Paper Series 2121, European Central BankGoogle Scholar
  183. Moss S (2008) Alternative approaches to the empirical validation of agent-based models. J Artif Soc Social Simul 11:(1). http://jasss.soc.surrey.ac.uk/11/1/5.html
  184. Muth JF (1961) Rational expectations and the theory of price movements. Econometrica 29:315–335Google Scholar
  185. Nelson RR, Winter SG (1982) An evolutionary theory of economic change. The Belknap Press of Harvard University Press, CambridgeGoogle Scholar
  186. Orphanides A, Williams JC (2008) Robust monetary policy with imperfect knowledge. J Monet Econ 54:1406–1435Google Scholar
  187. Pasinetti LL (1974) Growth and income distribution: essays in economic theory. Cambridge University Press, CambridgeGoogle Scholar
  188. Pasinetti LL (1983) Structural change and economic growth: a theoretical essay on the dynamics of the wealth of nations, vol 7. Cambridge University Press, CambridgeGoogle Scholar
  189. Pesaran HM, Chudik A (2011) Aggregation in large dynamic panels. Working Paper Series 3346, CESifoGoogle Scholar
  190. Piketty T, Zucman G (2014) Capital is back: wealth-income ratios in rich countries, 1700-2010. Q J Econ 129:1155–1210Google Scholar
  191. Ponomarenko A, Sinyakov A (2018) Impact of banking supervision enhancement on banking system structure: conclusions from agent-based modeling. Russian J Money Finance 77(1):26–50. https://ideas.repec.org/a/bkr/journl/v77y2018i1p26-50.html Google Scholar
  192. Ponta L, Raberto M, Teglio A, Cincotti S (2018) An agent-based stock-flow consistent model of the sustainable transition in the energy sector. Ecol Econ 145:274–300.  https://doi.org/10.1016/j.ecolecon.2017.08.022 . http://www.sciencedirect.com/science/article/pii/S0921800916310138 Google Scholar
  193. Poudyal N, Spanos A (2013) Confronting theory with data: model validation and dsge modeling. Working paper Department of Economics, Virginia Tech, USAGoogle Scholar
  194. Prigogine I (1980) From being to becoming: time and complexity in the physical sciences. Freeman, San FranciscoGoogle Scholar
  195. Raberto M, Teglio A, Cincotti S (2012) Debt deleveraging and business cycles. an agent-based perspective. Economics - The Open-Access, Open-Assessment E-Journal 6 (1-49)Google Scholar
  196. Raberto M, Ozel B, Ponta L, Teglio A, Cincotti S (2019) From financial instability to green finance: the role of banking and credit market regulation in the eurace model. J Evol Econ.  https://doi.org/10.1007/s00191-018-0568-2
  197. Ramsey FP (1928) A mathematical theory of saving. Econ J 38:543–559Google Scholar
  198. Rengs B, Scholz-Wäckerle M (2019) Consumption & class in evolutionary macroeconomics. J Evol Econ.  https://doi.org/10.1007/s00191-018-0592-2
  199. Romer P (1990) Endogenous technical change. J Polit Econ 98:71–102Google Scholar
  200. Romer P (2016) The trouble with macroeconomics. The American EconGoogle Scholar
  201. Rosser BJ (2011) Complex evolutionary dynamics in urban-regional and ecologic-economic systems: from catastrophe to chaos and beyond. Springer, New YorkGoogle Scholar
  202. Saari D, Simon CP (1978) Effective price mechanisms. Econometrica 46:1097–1125Google Scholar
  203. Salle I, Yıldızoğlu M (2014) Efficient sampling and meta-modeling for computational economic models. Comput Econ 44(4):507–536Google Scholar
  204. Salle I, Sénégas MA, Yıldızoğlu M (2019) How transparent about its inflation target should a central bank be? J Evol Econ.  https://doi.org/10.1007/s00191-018-0558-4
  205. Schmitt-Grohé S, Uribe M (2000) Price level determinacy and monetary policy under a balanced-budget requirement. J Monet Econ 45:211–246Google Scholar
  206. Seppecher P (2012) Flexibility of wages and macroeconomic instability in an agent-based computational model with endogenous money. Macroecon Dyn 16:284–297Google Scholar
  207. Seppecher P, Salle I (2015) Deleveraging crises and deep recessions: a behavioural approach. Appl Econ 47:3771–3790Google Scholar
  208. Seppecher P, Salle I, Lang D (2019) Is the market really a good teacher? J Evol Econ.  https://doi.org/10.1007/s00191-018-0571-7
  209. Simon HA (1955) A behavioral model of rational choice. Q J Econ 69:99–118Google Scholar
  210. Simon HA (1959) Theories of decision-making in economics and behavioral science. Am Econ Rev 49:253–283Google Scholar
  211. Simon HA (1977) An empirically based microeconomics. Cambridge University Press, CambridgeGoogle Scholar
  212. Sims CA (2010) Chapter 4 - rational inattention and monetary economics. Handbook of Monetary Economics, vol 3, Elsevier, pp 155–181.  https://doi.org/10.1016/B978-0-444-53238-1.00004-1. http://www.sciencedirect.com/science/article/pii/B9780444532381000041
  213. Smets F, Wouters R (2003) An estimated dynamic stochastic general equilibrium model of the euro area. J Eur Econ Assoc 1:1123–1175Google Scholar
  214. Smets F, Wouters R (2007) Shocks and frictions in us business cycles: a bayesian dsge approach. Am Econ Rev 97:586–606Google Scholar
  215. Solow RM (1956) A contribution to the theory of economic growth. Q J Econ 70:65–94Google Scholar
  216. Solow RM (2005) Reflections on growth theory. Handbook of Economic Growth 1:3–10Google Scholar
  217. Solow RM (2018) A theory is a sometime thing. Rev Keynesian Econ 6:421–424Google Scholar
  218. Sonnenschein H (1972) Market excess demand functions. Econometrica 40:549–556Google Scholar
  219. Steffen W, Rockström J, Richardson K, Lenton TM, Folke C, Liverman D, Summerhayes CP, Barnosky AD, Cornell SE, Crucifix M, Donges JF, Fetzer I, Lade SJ, Scheffer M, Winkelmann R, Schellnhuber HJ (2018) Trajectories of the earth system in the anthropocene. Proc Natl Acad Sci 115(33):8252–8259.  https://doi.org/10.1073/pnas.1810141115. http://www.pnas.org/content/115/33/8252.full.pdf Google Scholar
  220. Stiglitz J (2011) Rethinking macroeconomics: what failed, and how to repair it. J Eur Econ Assoc 9:591–645Google Scholar
  221. Stiglitz J (2015) Towards a general theory of deep downturns. Working Paper 21444, NBERGoogle Scholar
  222. Stiglitz JE (2017) Structural transformation, deep downturns, and government policy NBER. Working Papers 23794, National Bureau of Economic Research, IncGoogle Scholar
  223. Storm S, Naastepad CWM (2012a) Macroeconomics beyond the NAIRU. Harvard University Press, CambridgeGoogle Scholar
  224. Storm S, Naastepad CWM (2012b) Wage-led or profit-led supply: wages, productivity and investment. Conditions of Work and Employment Series 36, ILOGoogle Scholar
  225. Taylor J (2007) The explanatory power of monetary policy rules. Working Paper 13685, NBERGoogle Scholar
  226. Teglio A, Mazzocchetti A, Ponta L, Raberto M, Cincotti S (2017) Budgetary rigour with stimulus in lean times: policy advices from an agent-based model. J Econ Behavior Org.  https://doi.org/10.1016/j.jebo.2017.09.016
  227. Tesfatsion L (2006) Ace: a constructive approach to economic theory. In: Tesfatsion L, Judd K (eds) Handbook of computational economics II: agent-based computational economics. North Holland, AmsterdamGoogle Scholar
  228. Tesfatsion L, Judd K (eds) (2006) Handbook of computational economics II: agent-based computational economics. North Holland, AmsterdamGoogle Scholar
  229. Turner A (2010) The crisis, conventional economic wisdom, and public policy. Ind Corp Chang 19:1317–1329Google Scholar
  230. Turrell A (2016) Agent-based models: understanding the economy from the bottom up. Bank of England Quarterly Bulletin Q4Google Scholar
  231. Windrum P, Fagiolo G, Moneta A (2007) Empirical validation of agent-based models: alternatives and prospects. Journal of Artificial Societies and Social Simulation 10(2):8. http://jasss.soc.surrey.ac.uk/10/2/8.html Google Scholar
  232. Winker P, Gilli M, Jeleskovic V (2007) An objective function for simulation based inference on exchange rate data. J Econ Interac Coord 2:125–145Google Scholar
  233. Woodford M (1990) Learning to believe in sunspots. Econometrica 58:277–307Google Scholar
  234. Woodford M (2003) Interest and prices: foundations of a theory of monetary policy. Princeton University Press, PrincetonGoogle Scholar
  235. Woodford M (2013) Macroeconomic analysis without the rational expectations hypothesis. Ann Rev Econ 5:303–346Google Scholar
  236. Woodford M (2018) Monetary policy analysis when planning horizons are finite. University of Chicago Press, ChicagoGoogle Scholar
  237. Zarnowitz V (1985) Recent works on business cycles in historical perspectives: a review of theories and evidence. J Econ Lit 23:523–580Google Scholar
  238. Zarnowitz V (1997) Business cycles observed and assessed: why and how they matter. Working Paper 6230, NBERGoogle Scholar

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2019

Authors and Affiliations

  1. 1.EMbeDS and Institute of EconomicsScuola Superiore Sant’AnnaPisaItaly
  2. 2.OFCE, Sciences PoParisFrance

Personalised recommendations