Demand, credit and macroeconomic dynamics: A microsimulation model
Nomaler Z.O. () and
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Nomaler Z.O.: UNU-MERIT, and TU Eindhoven
No 47, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)
We develop a microsimulation model for the macroeconomic business cycle. Our model is based on three main ideas; i we want to specify how macroeconomic coordination is achieved without a dominating influence of price mechanisms, ii we want to incorporate the stock-flow-consistent approach that has become popular in post-Keynesian macroeconomics, and iii we want to allow for bankruptcies as a major mechanism in the business cycle. Compared to existing stock-flow-consistent models, our model has relatively few equations. It is operationalized using micro, agent-based simulation. The results show a clear business cycle that is driven by accumulation of financial assets and the effects this has on the real economy. By changing some of the key parameters, we show how the nature of the business cycle changes as a result of changes in the assumed behaviour of agents.
Keywords: Demand; Credit; Economic dynamics; Macroeconomics; Price mechanisms; Stock-flow; Bankrupties; Business cycles; Agent-based simulation; Microsimulation (search for similar items in EconPapers)
JEL-codes: E00 E32 B50 B52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp, nep-hme and nep-mac
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Journal Article: Demand, credit and macroeconomic dynamics. A micro simulation model (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:unm:unumer:2014047
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