Category Archives: 3rd Open GSS Conference

Agent-based models for GSS – Beijing 2013

GSS preparatory meeting, Beijing, October 29, 2013

Notes on the parallel session about agent-based models for GSS

In general agent-based models have proven to be useful in modeling systems characterized by emergent properties at macro level, heterogeneous interacting agents, networks and bounded rationality. In economics agent-based models emerged from the criticism towards the representative agent and the perfect rationality assumption.

The group discussed the research area in which they are applying agent-based models, which are the following:

  • Transportation/traffic issues
  • Disaster response (shelter topology & impacts on economic activity)
  • Climate change and sustainable economic system
  • Housing markets
  • Macroeconomic & financial system
  • Integrated risk governance

Furthermore, it was discussed that agent-based modeling is one of several tools, whose usefulness depends on the specific system or problem to be studied.

Concerning the usefulness for different applications, an important question that was addressed was: Where have agent-based models been used successfully? Where have they improved the understanding of specific problems and related decision making. We identified:

  • Pedestrian traffic (where heterogeneity is not important, but the topology and a large number of actors are important)
  • Panics in large groups/herd behavior in financial markets
  • Epidemics

The first has been widely used to understand crowd behavior and design safer public structures such as subway stations and airports and possibly improve post-disaster management. The second have proven to replicate boundedly rational behavior of human beings, both in financial markets and in emergency situations. We regard the other topics as promising in terms of generating new insights.

An interesting question for the GSS conference would be how agent-based models can be used for analyzing global systems instead of for specific questions only. In this regard, we propose to invite agent-based modelers working on more elaborate models.

We discussed scale effects, in particular which number of agents are needed for specific applications. We discussed a proposals of aggregating agents (not using representative agents) and the possible levels of aggregation, such as micro or meso level modeling of agents.

Especially considering economic models we need to improve the communication with policy makers and mainstream economists.  In this regard, a crucial aspect which should be addressed in the conference is how to estimate, calibrate and validate agent-based models with empirical data.

Another important question is which programming tools can be used to share code and models and to minimize programing errors. Due to lack of time we did not elaborate on this topic. However, it is an important issue and should be addressed in the conference.

Report from Working Group on Global Financial Systems

GSS Preparatory Meeting on October 29 2013 – Report on Working Group Session on Financial Systems

Suggested Dates for third GSS conference: October-November.

Topics touched upon in the discussion that the group thought should be covered in the next conference:
– financial networks, resilience against shocks, contagion etc. in the presence of complex instruments such as derivatives, collateralization, etc.
– climate-finance
– climate change impact on macro
– linkage finance – real economy and
– societal role / social function of financial system
– shaping a socially useful financial system
– finance is about assets and actors do not matter. this community is moving towards a view in which actors are central and not the assets. influence of actors.
– crowdsourcing
– actors, interests, values, stakeholders
– banks: how are they taking care of risk in the years to come?  linkage to integrative risk management working group.
– short-term versus long term. E.g. Pension funds: do the instruments they use really serve the social purpose
– international financial system political economy side

The above topics can be grouped in the following 5 areas that the group suggests as topics for the Sessions in the next conference.
1 financial networks and financial innovations and resilience
2. linkage climate change, sustainability – finance,  climate change impact on macro
3. linkage finance – real economy – shaping a socially useful financial system
4. actors, interests and values in the financial system
5. reforming the international financial system: political economy

New Forms of Global Collaboration

Here is a review from the The Economist of 19 October 2013 of a report from the Oxford Martin Commission for Future Generations, which seems to bear on some of the thoughts aired by Carlo at the first Open GSS on the new for new forms of global governance.  For example “it proposes two modest but useful reforms. The first is to make more use of “creative coalitions”….  What it means is ad hoc groups spanning governments, multilateral organisations, business, charities and NGOs which try to deal with a particular problem outside the gridlocked processes of global governance. A successful example is the coalition that is sharply reducing deaths from malaria.  Its members include the United Nations, the World Health Organisation and ExxonMobil as well as the Bill & Melinda Gates Foundation and assorted governments from big rich countries and small poor ones. The commission proposes a similar effort to detect and respond to cybersecurity problems (to be called CyberEx), and another (to be called C20-C30-C40, it suggests) to combine 20 countries, 30 companies and 40 cities in search of a common agenda for tackling climate change.

Urban Science

Here are two documents I have written over the summer on beginning to define a “science of cities” or Urban Science.  The first is a “ghostman” outline for a future (5-10 years) textbook on Urban Science that grew out of a workshop on cities at the Santa Fe Institute.  The second is a talk on “Cities as Systems” that I gave at the request of Ralph Dum at the European Forum in Alpbach, Austria in August 2013.

ICT for Cities

Here is a chapter I wrote for a book on “Rapid Urbanization and the Future of Transforming Cities in Asia”.  It is edited by Professor Genie Birch of the University of Pennsylvania.   The book will be published early in 2014 so please do not distribute widely.  The chapter deals mainly with the problem that municipal governments have been slow to adopt ICT as an agent of transformation.  It does not deal specifically with smart cities.