Another Keynesian

[From Bill Williams 25 January 2004 8:45 PM CST]

I've just finished a first look, not really a first read,
of Charlotte Bruun's paper that Bill Powers found on the

The paper concludes with a last sentence that says,

  "Thus the results of our simulation open up for a
   relevance of Keynesian macro economic theory, and
   hopefully it enable us to extend this theory."

Charlotte Brauun 1999 "Agent Based Keynesian Economics"

Again, what I did was look at the paper rather than read
it. However, I saw some things that made a good impression
on me. She cites work in the Post-Keynesian tradition, such
as Minsky who was the dissertation supervisor for Randy Wray
who heads the macro-economic section here. Minsky's work is
similar in structure to Veblen's earlier work _The Theory
of Business Enterprize_. My dissertation was writen on
the causal and mathematical structure underlying Veblen's
position. And, I consider Minsky's work to be good economics.

The paper isn't as clear, or at least as accessible regarding
precisely what relationships Brauun assumes. This unfortunately
is often the case for Macro Economic theorists, and Brauun
comments on the immature state of the art in modeling. Agent
based modeling in macro economics is relatively very new.

What I could see on a first look at Brauun's paper leads me
to be optomistic about what I will find on further study.

However, the agents in Brauun's simulation are rule based
agents. I would think that a shift to control theory agents
might make for quite an improvement. And, the structure of
Brauun's modeling, issues regarding agents aside, is not in
my view as sophisticate as the one that Powers employes.
(See recent post for Bill's description)

It might be possible
to introduce control theory agents into Brauun's model without
going to the work of rewriting the whole program.

Bill Williams