tag:blogger.com,1999:blog-26741618.post257835418563541542..comments2024-02-28T02:22:20.886-08:00Comments on homunculus: A new kind of economicsPhilip Ballhttp://www.blogger.com/profile/09986655706443117158noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-26741618.post-45847452229226745592010-07-28T13:42:52.330-07:002010-07-28T13:42:52.330-07:00Peter,
It's true, and an acknowledged problem,...Peter,<br />It's true, and an acknowledged problem, that agent behaviour is unlikely to stay fixed when the boundaries (such as regulation) change (see Goodhart's Law). That might be handled in ad hoc ways, but ultimately the hope is to build enough psychological or even neurological complexity into agents to allow for it. That is a long way off! On the other hand, conventional models don't have a hope of capturing such behaviour either.<br />I think it is probably the case with economics as with the weather that one can distinguish between short-to-medium-term unpredictability (weather forecasts) and long-term trends (climate prediction). So there are doubtless some long-term things one can foresee, but not in terms of the details.Philip Ballhttps://www.blogger.com/profile/09986655706443117158noreply@blogger.comtag:blogger.com,1999:blog-26741618.post-26005006282534608012010-07-28T05:57:35.110-07:002010-07-28T05:57:35.110-07:00The aim "would be to identify where the syste...The aim "would be to identify where the systemic vulnerabilities lie, what regulations might mitigate them (and which would do the opposite), and whether early-warning systems could spot danger signs."<br /><br />The problem here would be, I think, that for any given new legislation one could not know whether the agent models we currently use will give an adequate prediction of response to the given stimulus (although some people will be able to guess better than others, just as interpretation of medium range weather forecasts is something of an art). If we were to omit certain kinds of agent to agent communication, for example, which we might do to ensure tractability, there would be some legislation for which prediction would go far awry, while other legislation would give no problems.<br /><br />It's not clear to me whether the complexity of economic models is greater than or less than the complexity of medium range weather forecasts. Ditto for usefulness. Any views?Peterhttps://www.blogger.com/profile/08654675777726560464noreply@blogger.com