The Missing Link: AB Models and Dynamic Microsimulation

  • Matteo RichiardiEmail author
Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 669)


In this note I pay tribute to two early works by Barbara Bergmann and Gunnar Eliasson which, though firmly grounded in the dynamic microsimulation literature, can be considered as the first examples of large-scale agent-based models. These attempts at building complete micro-to-macro computational models of the economy are important not only in a history of economic thought perspective, but also to encourage convergence of the two approaches in developing credible alternatives to DSGE models.


Labor Market Consumption Good Computable General Equilibrium Computable General Equilibrium Model Dynamic Stochastic General Equilibrium 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.



Financial support from Collegio Carlo Alberto is gratefully acknowledged.


  1. 1.
    Anderson P, Arrow K, Pines D (eds) (1988) The economy as an evolving complex system. SFI studies in the sciences of complexity. Addison-Wesley Longman, Redwood CityGoogle Scholar
  2. 2.
    Arthur W, Durlauf S, Lane D (eds) (1997) The economy as an evolving complex system II. Addison-Wesley Longman, ReadingGoogle Scholar
  3. 3.
    Ballot G (2002) Modeling the labor market as an evolving institution: model artemis. J Econ Behav Organ 49:51–77CrossRefGoogle Scholar
  4. 4.
    Bennett RL, Bergmann BR (1986) A microsimulated transactions model of the United States economy. John Hopkins University Press, BaltimoreGoogle Scholar
  5. 5.
    Bergmann BR (1973) Labor turnover, segmentation and rates of unemployment: a simulation-theoretic approach. Technical report, University of MarylandGoogle Scholar
  6. 6.
    Bergmann BR (1974) A microsimulation of the macroeconomy with explicitely represented money flows. Ann Econ Soc Meas 3(3):475–489Google Scholar
  7. 7.
    Bergmann BR, Eliasson G, Orcutt GH (eds) (1977) Micro simulation–models, methods, and applications: proceedings of the symposium on micro simulation methods, Stockholm, 19–22 SeptGoogle Scholar
  8. 8.
    Blume L, Durlauf S (eds) (2006) The economy as an evolving complex system, III. Current perspectives and future directions. Oxford University Press, OxfordGoogle Scholar
  9. 9.
    Caballero RJ (2010) Macroeconomics after the crisis: time to deal with the pretense-of-knowledge syndrome. J Econ Perspect 24:85–102CrossRefGoogle Scholar
  10. 10.
    Cincotti, Silvano RM, Teglio A (2010) Credit money and macroeconomic instability in the agent-based model and simulator eurace. Economics: Open-Access, Open-Assess E-J 4(2010-26).
  11. 11.
    Colander D, Howitt P, Kirman A, Leijonhufvud A, Mehrling P (2008) Toward an empirically based macroeconomics. Am Econ Rev Papers Proc 98(2):236–240CrossRefGoogle Scholar
  12. 12.
    Dawid H, Neugart M (2011) Agent-based models for economic policy design. East Econ J 37(1):44–50CrossRefGoogle Scholar
  13. 13.
    Dawid H, Gemkow S, Harting P, van der Hoog S, Neugart M (2009) On the effects of skill upgrading in the presence of spatial labor market frictions: an agent-based analysis of spatial policy design. J Artif Soc Soc Simul 12:4Google Scholar
  14. 14.
    Dawid H, Gemkow S, Harting P, van der Hoog S, Neugart M (2011) The eurace@unibi model: an agent-based macroeconomic model for economic policy design. Technical report, University of BielefeldGoogle Scholar
  15. 15.
    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(3):543–562CrossRefGoogle Scholar
  16. 16.
    Dawid H, Gemkow S, Harting P, van der Hoog S, Neugart M (2013) Agent-based macroeconomic modeling and policy analysis: the eurace@unibi model. In: Chen S-H, Kaboudan M (eds) Handbook on computational economics and finance. Oxford University Press, Oxford (forthcoming)Google Scholar
  17. 17.
    Deissenberg C, van der Hoog S, Dawid H (2008) Eurace: a massively parallel agent-based model of the European economy. Appl Math Comput 204:541–552CrossRefGoogle Scholar
  18. 18.
    Dosi G, Nelson R (1994) An introduction to evolutionary theories in economics. J Evol Econ 4:153–172CrossRefGoogle Scholar
  19. 19.
    Eliasson G (1977) Competition and market processes in a simulation model of the Swedish economy. Am Econ Rev 67:277–281Google Scholar
  20. 20.
    Eliasson G (1991) Modeling the experimentally organized economy: complex dynamics in an empirical micro-macro model of endogenous economic growth. J Econ Behav Organ 16: 153–182CrossRefGoogle Scholar
  21. 21.
    Eliasson G, Olavi G, Heiman M (1976) A micro-macro interactive simulation model of the swedish economy. FörvaltningsbolagetSindexGoogle Scholar
  22. 22.
    Farmer DJ, Gallegati M, Hommes C, Kirman A, Ormerod P, Cincotti S, Sanchez A, Helbing D (2012) A complex systems approach to constructing better models for managing financial markets and the economy. J Eur Phys J: Spec Top 214(1):295–324CrossRefGoogle Scholar
  23. 23.
    Fernández-Villaverde J (2010) The econometrics of dsge models. SERIEs 1:3–49CrossRefGoogle Scholar
  24. 24.
    Gallegati M, Richiardi M (2009) Agent-based modelling in economics and complexity. In: Meyer B (ed) Encyclopedia of complexity and system science. Springer, New York, pp 200–224CrossRefGoogle Scholar
  25. 25.
    Gardner M (1970) Mathematical games: the fantastic combinations of john conwa’s new solitaire game ‘life’. Sci Am 223(4):120–123CrossRefGoogle Scholar
  26. 26.
    Grazzini J, Richiardi M (2013) Consistent estimation of agent-based models by simulated minimum distance. Working Paper 130/2013, LABORatorio R. RevelliGoogle Scholar
  27. 27.
    Grazzini J, Richiardi M, Sella L (2012a) Small sample bias in msm estimation of agent-based models. In Teglio A, Alfarano S, Camacho-Cuena E, Ginés-Vilar M (eds) Managing market complexity. The approach of artificial economics. Lecture notes in economics and mathematical systems. Springer, HeidelbergGoogle Scholar
  28. 28.
    Grazzini J, Richiardi MG, Sella L (2012b) Indirect estimation of agent-based models. An application to a simple diffusion model. Complex Econ 1(2): (forthcoming)Google Scholar
  29. 29.
    Kirman A (2010) The economic crisis is a crisis for economic theory. CESifo Econ Stud 56(4):498–535CrossRefGoogle Scholar
  30. 30.
    Krugman P (2011) The profession and the crisis. East Econ J 37:303–312CrossRefGoogle Scholar
  31. 31.
    Li J (2011) Dynamic microsimulation for public policy analysis. Boekenplan, MaastrichtGoogle Scholar
  32. 32.
    Martini A, Trivellato U (1997) The role of survey data in microsimulation models for social policy analysis. Labour 11(1):83–112CrossRefGoogle Scholar
  33. 33.
    Morand E, Toulemon L, Pennec S, Baggio R, Billari F (2010) Demographic modelling: the state of the art. SustainCity Working Paper 2.1a, Ined, ParisGoogle Scholar
  34. 34.
    Olson PI (2007) On the contributions of Barbara Bergmann to economics. Rev Pol Econ 19:475–496CrossRefGoogle Scholar
  35. 35.
    Orcutt GH (1957) A new type of socio-economic system. Rev Econ Stat 39:116–123CrossRefGoogle Scholar
  36. 36.
    Orcutt GH (1990) The microanalytic approach for modeling national economies. J Econ Behav Organ 14:29–41CrossRefGoogle Scholar
  37. 37.
    Orcutt GH, Greenberger M, Korbel J, Rivlin AM (1961) Microanalysis of socioeconomic systems. A simulation study. Harper & Brothers, New YorkGoogle Scholar
  38. 38.
    Peichl A (2009) The benefits and problems of linking micro and macro models. Evidence from a flat tax analysis. J Appl Econ XII(2):301–329Google Scholar
  39. 39.
    Richiardi M (2012) Agent-based computational economics: a short introduction. Knowl Eng Rev 27(2):137–149CrossRefGoogle Scholar
  40. 40.
    Schelling T (1969) Models of segregation. Am Econ Rev 59(2):488–493Google Scholar
  41. 41.
    Solow R (2010) Building a science of economics for the real world. Subcommittee on investigations and oversight, committee on science and technology, hearing of Jul 20, 2010 10:00am to 12:00pmGoogle Scholar
  42. 42.
    Stiglitz JE (2011) Rethinking macroeconomics: what failed, and how to repair it. J Eur Econ Assoc 9:591–645CrossRefGoogle Scholar
  43. 43.
    Teglio A, Raberto M, Cincotti S (2012) The impact of banks’ capital adequacy regulation on the economic system: an agent-based approach. Adv Complex Syst 15(suppl02):361–400Google Scholar
  44. 44.
    Tovar CE (2008) Dsge models and central banks. BIS Working Papers 258, Bank for International SettlementsGoogle Scholar
  45. 45.
    von Neumann J, Burks A (1966) Theory of self-reproducing automata. University of Illinois Press, UrbanaGoogle Scholar

Copyright information

© Springer International Publishing Switzerland 2014

Authors and Affiliations

  1. 1.Department of Economics and StatisticsUniversity of TorinoTorinoItaly
  2. 2.Collegio Carlo Alberto and LABORatorio Riccardo RevelliMoncalieri, TorinoItaly

Personalised recommendations