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Just as we have weather forecasting, climate models .. we do need and should have good fine-grain computational models of complex systems such as the cell .. and the global economy.

We should be able to have whole economy simulations give reasonable predictions in response to natural events and lever-pulling such as :

- higher progressive tax rates - central bank interest rate moves - local tariffs and sanctions - shipping blackades / blockages - regional war - extreme weather events - earthquake - regional epidemic - giving poor people cash grants - free higher education - science research grants - skilled immigration / emigration

But .. of course this would require something like a rich country providing grants to applied cross disciplinary research over many years.

It might even lead to insights that prevent semi-regular economic boom and bust cycles we experienced the past 100 years.

Related: MONIAC, a 1949 analogue computer macroeconomics simulator, with water flowing through the machine representing money and spending etc.

https://en.m.wikipedia.org/wiki/Phillips_Machine

Short clip: https://youtu.be/beuseJ0Wm3M

Detailed demo: https://youtu.be/gkNaZJmii28

Agent-based modeling offers a more realistic approach to economic systems than traditional equilibrium models. New approachs including generative agents (ABM+LLMs) are promising. J. Doyne Farmer's recent book "Making Sense of Chaos: A Better Economics for a Better World" is a great reading for those interested in this field.

https://www.amazon.com/Making-Sense-Chaos-author/dp/02412019...

The most interesting toy economy I’ve seen has been d2jsp and its “forum gold”. Forum gold is primarily used as a fiat currency for diablo 2 trading. It’s a janky digital currency on a janky forum from like 20ish years ago, that’s still alive today. You can technically buy the currency from the forum, but in practice few do that. Most people just trade items to bootstrap.

Having futzed with bartering in diablo (and non-fiat trading denominated in items of stable value), I quickly came to appreciate fiat currency. Being able to combine two “half trades” into an equivalent barter exchange is vastly easier.

At one point I was able to trade some of the forum gold I accumulated from diablo 2 for a “perfect IV foreign Ditto” for shiny pokemon breeding.

Just as in the real world we don't spend most time fighting between each other or some monsters, it would be nice to have a MMO that focuses mostly on economic activities. By that I mean producing goods services and trading.

Primer is a youtube channel with a fantastic intuitive and gentle introduction to this topic: https://www.youtube.com/watch?v=PNtKXWNKGN8

This paper from one of the field's pioneers is a nice introductory overview of the space from an academic perspective: https://faculty.sites.iastate.edu/tesfatsi/archive/tesfatsi/...

Predicting the weather helps save money for rich people. Predicting the economy might not be as profitable for them if everybody uses it. Booms and busts are a feature, not a bug.

This is not so much a model economy as it is a model market. But still interesting to see the dynamics that emerge from even an algorithmically simple model when you have multiple agents interacting over time.

For even a simple economy, I think you'd need to simulate money directly, and include the notions of rent and work.

This is very very interesting.

Want to hear some of the behind-the-scenes stories. What was the initial scope and how did you break down the whole project? As it's very hard to wrap around the whole thing at once.

can the economy even be predicted ? Was it ever done to any successful degree in the past ? And if so, to what end ?

I like the idea conceptually, but it doesn't seem to be good enough to halt economic disasters (or correction as we like to call them nowadays).

I wonder how those plots were made, they're neat. GNUplot?

You don't actually have to put a generated image at the top of every blog post guys.