Where Do We Go from Here?
At the end of this book, it is clear to us that the research carried out so far is only a step in a much longer intellectual voyage. We feel the need to pause and reflect not only on the distance already covered but also on the direction we have to take for future research. For this simple reason, this concluding chapter is not a conclusion at all. We want to open a window on the future to foresee the shifting ground of research in contemporary macroeconomics and position ourselves, our incomplete and as yet probably inadequate set of ideas, methods and tools in the debate that will come.
KeywordsInterest Rate Banking System Agent Base Modelling Credit Market Reservation Wage
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- 1.The literature on issues pertaining to heterogeneity is growing at a very high exponential rate. An early overview of the role of heterogeneity in macro-dynamic models of the’ 90s in Delli Gatti, Gallegati and Kirman (2000). Hommes (2006) surveys models with heterogeneous agents focusing mainly on financial markets.Google Scholar
- 2.Tesfatsion and Judd (2006) provides a comprehensive survey of the different viewpoints from which the exploration of behaviour of individual agents can be carried out.Google Scholar
- 3.The practice of combining heterogeneity and interactions is at odds with mainstream macroeconomics which is unable, by construction, to explain non-normal distributions, scaling behavior or the occurrence of large aggregate fluctuations as a consequence of small idiosyncratic shocks. As Axtell (1999: 41) claims: “given the power law character of actual firms’ size distribution, it would seem that equilibrium theories of the firm [... ] will never be able to grasp this essential empirical regularity.”Google Scholar
- 4.See Arthur (2006) for a thorough treatment of this point.Google Scholar
- 5.For a thorough discussion of the procedure and comparison with other aggregation procedures see Gallegati et al. (2006).Google Scholar
- 6.As an alternative, one can apply an aggregation procedure to the individual law of motion and determine a two dimensional non-linear dynamic system in discrete time which describes the evolution over time of the mean and the variance of the distribution itself. For an example see Agliari et al. (2000).Google Scholar
- 7.We borrow this expression from the idea of a generative social science. See Arthur (2006)Google Scholar