I am currently reviewing Mary Morgan's book, The World in the Model. (An excellent book, by the way, and one that shows the value of the history of economic thought for the practice of economics: economists who read it will, I think, have a much better understanding of what modeling is all about.)

At the same time, I am busy building agent-based models. It is propitious that these two things are happening at the same time: my own modeling makes me appreciate Morgan's insights much better. In particular, she notes that models are away to explore how the world possibly works by exploring how the model works. The nature of models as something to explore has, I think, been underappreciated. I am fascinated, in working with my model of Adam Smith's theory of fashion, to see how much the results coming out of the model change based on tweaking the assumptions going into it. For instance, changing the amount of time that agents will tolerate a fashion scene not to their liking has dramatic effects on the cyclical waves of fashion that emerge from the model.


  1. One of Krugman's dicta is that it matters less what model you use than that you use one. Models allow exactitude and careful statement (You see why Austrians shun them.)


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