Social and economic modelling

[From Richard Kennaway (2009.10.13.1315 BST)]

I just came across a book, "Growing artificial societies: social science from the bottom up", by Joshua Epstein, and Robert Axtell. I don't have the book (yet -- I'm just going to borrow it from my university library), but I've been looking at the parts available on Google Books:
http://books.google.com/books?id=8sXENe8QrmYC

There's no hint of control systems in it from what I've seen, but for those making control models of people in societies, it might be interesting background on the competition. There's a lot more of this sort of thing out there, and even a Wikipedia article (http://en.wikipedia.org/wiki/Agent-based_model), although it's mostly about agents that work by planning optimal actions.

My point though is that there's already a huge context for this sort of thing, but one that I don't think is as strongly wedded as psychology is to theoretical models positively antithetical to the idea of control systems. The broader theoretical idea is only that agents work by simple rules (and what could be simpler than o = k(r-p)!) from which complex social phenomena emerge.

···

--
Richard Kennaway, jrk@cmp.uea.ac.uk, http://www.cmp.uea.ac.uk/~jrk/
School of Computing Sciences,
University of East Anglia, Norwich NR4 7TJ, U.K.

[From Bill Powers (2009.10.14.0838 MDT)]

Richard Kennaway (2009.10.13.1315 BST) --

My point though is that there's already a huge context for this sort of thing, but one that I don't think is as strongly wedded as psychology is to theoretical models positively antithetical to the idea of control systems. The broader theoretical idea is only that agents work by simple rules (and what could be simpler than o = k(r-p)!) from which complex social phenomena emerge.

The reference you cite does look promising. There's one principle of modeling as I see it that isn't clear in what I read. Some models seem aimed at directly representing the phenomena, or the behaviors, that are observed. I'm reminded of Kelso's approach to how organisms walk: he sees it as a "pendular" movement of the legs, which of course is the appearance we would want a model to generate, but the image of a pendulum is misplaced since the location of the foot during a step is fixed, the foot swinging only when not bearing weight. And you don't model a pendulum by starting with a component that already swings like a pendulum.

As I have always understood modeling and simulation, we begin by looking at the components of the system and how they each, in isolation, convert causes into effects, inputs into outputs. Once the components have been characterized, they are connected together, the outputs of some components being inputs to others, with the exception of those that receive inputs from outside the system, or send their outputs to places outside the system. We don't try to put the behavior we expect into the system at the start; in fact, we pretend we don't know what this assemblage of components will do when connected together, and set up the simulation to show us what will happen. As you say above, the whole point is for the behavior to EMERGE honestly from the organization of the system, rather than being programmed into it.

If you program the behavior into the model, I call the result an animation, not a simulation. You can make animations do anything you like just by drawing successive frames, which is why most animations of organisms don't behave very naturally. It doesn't take much of a deviation from the real physics of movements to make animated movements look unnatural. But models which produce movement by simulation look much more realistic; ironically, simulated systems show behavior that the creator of the simulation might view with surprise, or dismay. That's why they're more convincing than animations when you get them right.

The idea of working by rules is, I think, closer to animation than simulation. Of course in playing games and in other circumstances we do work by rules, so a model based on rules would be appropriate. But in most cases the apparent rules are artifacts. My example of the rules built into Pribram's TOTE unit shows what I mean. The behavior of a raindrop can be modeled as

Test: if raindrop has not hit ground yet,
Operate: keep falling, Test again
   otherwise ...
Exit: splash!

So: Test, Operate, Test, Operate, Test, ... Splash! TOTOTE.

This rule, a program, describes what happens, but not the reason why it happens. I see similar things in linguistics: rules that appear to capture how people talk, but no simulation from which talking emerges. The rules can actually get much more complicated than the actual "how" of the behavior. Describing in words how a hierarchy of control systems works is a very lengthy process -- it once took me a whole book to do it. But a simulation of a working control system can be done in a few lines of Pascal code.

You ask "what could be simpler than o = k(r-p)!". The answer is o = k*e, because e is the input to the output function and o is the output, or e = r - p, because the comparator converts the two inputs, r and p, into the output e. The system equations for a control system represent one component each; solving them simultaneously establishes the connections between components and shows you the result of those connections.

This is what I'm trying to get at with my simple economic models. I don't put any economic behavior into the model: I just try to set up a collection of components, each component being a simple input-output relationship such as the fact that if I buy goods from you at a given price a certain amount of money leaves my bank account and moves into yours, and a certain quantity of goods leaves your inventory and moves into mine. I say that a manager tries to control inventory by adjusting the price, while a consumer tries to control the bank account by adjusting how many goods are bought and how many hours are worked. What will happen when you connect these simple relationships together? What should happen is that the model will behave in a way that's like the way real people behave. Actually, my model doesn't behave quite right, so it needs modification. But the modification won't consist of making the model produce the right behavior. It will consist of changing the assumptions about how some component of the system works, and seeing how that changes the behavior of the whole system when the simulation is set in motion.

What's you assessment of how Epstein and Axell do their modeling?

Best,

Bill P.

[From Frank Lenk (2009.10.14.10:57 CDT)]

I regret that I have been reduced again to mere lurker status by the
projects I have going on at work - no time for even thinking about model
development for perhaps another 2 weeks at least.

Still, the Epstein/Axtell reference caught my eye. I briefly review
some of their work in my dissertation proposal that I sent out to the
list.

In general, they are trying to produce the minimum set of rules that
produces "interesting" behavior. They are not so concerned with whether
these rules are behaviorally realistic, i.e., whether people actually
use anything resembling them to determine their behavior.

I regard them as proof-of-concept models - that the agent-based approach
has the potential to model whole societies from the bottom up. But I
would very much like to drive such models with the more realistic view
of how people behave that PCT provides.

At any rate, doing some portion of that is what I propose to do for my
dissertation.

Frank

···

-----Original Message-----
From: Control Systems Group Network (CSGnet)
[mailto:CSGNET@LISTSERV.ILLINOIS.EDU] On Behalf Of Bill Powers
Sent: Wednesday, October 14, 2009 10:45 AM
To: CSGNET@LISTSERV.ILLINOIS.EDU
Subject: Re: [CSGNET] Social and economic modelling

[From Bill Powers (2009.10.14.0838 MDT)]

Richard Kennaway (2009.10.13.1315 BST) --

My point though is that there's already a huge context for this sort
of thing, but one that I don't think is as strongly wedded as
psychology is to theoretical models positively antithetical to the
idea of control systems. The broader theoretical idea is only that
agents work by simple rules (and what could be simpler than o =
k(r-p)!) from which complex social phenomena emerge.

The reference you cite does look promising. There's one principle of
modeling as I see it that isn't clear in what I read. Some models
seem aimed at directly representing the phenomena, or the behaviors,
that are observed. I'm reminded of Kelso's approach to how organisms
walk: he sees it as a "pendular" movement of the legs, which of
course is the appearance we would want a model to generate, but the
image of a pendulum is misplaced since the location of the foot
during a step is fixed, the foot swinging only when not bearing
weight. And you don't model a pendulum by starting with a component
that already swings like a pendulum.

As I have always understood modeling and simulation, we begin by
looking at the components of the system and how they each, in
isolation, convert causes into effects, inputs into outputs.
Once the components have been characterized, they are connected
together, the outputs of some components being inputs to others, with
the exception of those that receive inputs from outside the system,
or send their outputs to places outside the system. We don't try to
put the behavior we expect into the system at the start; in fact, we
pretend we don't know what this assemblage of components will do when
connected together, and set up the simulation to show us what will
happen. As you say above, the whole point is for the behavior to
EMERGE honestly from the organization of the system, rather than
being programmed into it.

If you program the behavior into the model, I call the result an
animation, not a simulation. You can make animations do anything you
like just by drawing successive frames, which is why most animations
of organisms don't behave very naturally. It doesn't take much of a
deviation from the real physics of movements to make animated
movements look unnatural. But models which produce movement by
simulation look much more realistic; ironically, simulated systems
show behavior that the creator of the simulation might view with
surprise, or dismay. That's why they're more convincing than
animations when you get them right.

The idea of working by rules is, I think, closer to animation than
simulation. Of course in playing games and in other circumstances we
do work by rules, so a model based on rules would be appropriate. But
in most cases the apparent rules are artifacts. My example of the
rules built into Pribram's TOTE unit shows what I mean. The behavior
of a raindrop can be modeled as

Test: if raindrop has not hit ground yet,
Operate: keep falling, Test again
   otherwise ...
Exit: splash!

So: Test, Operate, Test, Operate, Test, ... Splash! TOTOTE.

This rule, a program, describes what happens, but not the reason why
it happens. I see similar things in linguistics: rules that appear to
capture how people talk, but no simulation from which talking
emerges. The rules can actually get much more complicated than the
actual "how" of the behavior. Describing in words how a hierarchy of
control systems works is a very lengthy process -- it once took me a
whole book to do it. But a simulation of a working control system can
be done in a few lines of Pascal code.

You ask "what could be simpler than o = k(r-p)!". The answer is o =
k*e, because e is the input to the output function and o is the
output, or e = r - p, because the comparator converts the two inputs,
r and p, into the output e. The system equations for a control system
represent one component each; solving them simultaneously establishes
the connections between components and shows you the result of those
connections.

This is what I'm trying to get at with my simple economic models. I
don't put any economic behavior into the model: I just try to set up
a collection of components, each component being a simple
input-output relationship such as the fact that if I buy goods from
you at a given price a certain amount of money leaves my bank account
and moves into yours, and a certain quantity of goods leaves your
inventory and moves into mine. I say that a manager tries to control
inventory by adjusting the price, while a consumer tries to control
the bank account by adjusting how many goods are bought and how many
hours are worked. What will happen when you connect these simple
relationships together? What should happen is that the model will
behave in a way that's like the way real people behave. Actually, my
model doesn't behave quite right, so it needs modification. But the
modification won't consist of making the model produce the right
behavior. It will consist of changing the assumptions about how some
component of the system works, and seeing how that changes the
behavior of the whole system when the simulation is set in motion.

What's you assessment of how Epstein and Axell do their modeling?

Best,

Bill P.