Simulating the industrial revolution: a history-friendly model

Nicola Visonà () and Luca Riccetti
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Nicola Visonà: Università degli Studi di Macerata

Journal of Economic Interaction and Coordination, 2024, vol. 19, issue 4, No 10, 862 pages

Abstract: Abstract In this paper, we present a first modelization of Allen’s argument on the British industrial revolution with a history-friendly model heuristic. To do so, we use a macroeconomic micro-founded framework with heterogeneous agents—households, firms, and institutions—interacting through a decentralized matching process presenting standard features across five markets—labor, food, goods, services, and government bonds. We study the dynamics of the model using computer simulation. With the appropriate calibration, macroeconomic properties emerge such as endogenous business cycles and nominal GDP growth, while reproducing important stylized economic facts like the industrial revolution and Engel’s Pause.

Keywords: Agent-based models; History-friendly models; Industrial revolution; Macroeconomics (search for similar items in EconPapers)
JEL-codes: B52 C63 D21 E17 N13 O14 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11403-024-00421-3

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