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Simulation Experiments and Significance Tests

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Book cover Artificial Economics and Self Organization

Part of the book series: Lecture Notes in Economics and Mathematical Systems ((LNE,volume 669))

Abstract

The paper uses two formal models of simple processes in artificial worlds—one with and one without an analytical solution—to discuss the role of statistical analysis and significance tests of results from multiple simulation runs. Moreover the paper argues that it is not the sheer existence of an effect of input parameters on simulation results but the effect size which is the interesting outcome of a simulation and that significance tests of differences in means are much less important than the distribution of output variables which are more often than not non-normal distributions.

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Notes

  1. 1.

    For an in-depth discussion of “the cult of statistical significance” see [8]. Particularly, Ziliak and McCloskey criticise the use of sentences like “The differences reached the level of statistical significance, by and large.” [p. 35]. Their general argument is that it is not enough to “decide ‘whether there exists an effect’ ” [p. 25], but that it is necessary to ask “the scientific question ‘How much is the effect?’ ”.

  2. 2.

    A numerical solution of this system of differential equations is a simulation of the macro object ‘population’ with the vector-valued attribute ‘probability of being in one of the possible states’.

  3. 3.

    This model goes back to discussions between Gregor van der Beek, two master students and the author, was partly documented in the two students’ master thesis [5] and extended by the present author.

  4. 4.

    The current version of the model can be found among the NetLogo User Community Models, http://ccl.northwestern.edu/netlogo/models/community/MinimumWages.

References

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Correspondence to Klaus G. Troitzsch .

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Troitzsch, K.G. (2014). Simulation Experiments and Significance Tests. In: Leitner, S., Wall, F. (eds) Artificial Economics and Self Organization. Lecture Notes in Economics and Mathematical Systems, vol 669. Springer, Cham. https://doi.org/10.1007/978-3-319-00912-4_2

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