Agent-Based Macroeconomic Modeling and Policy Analysis: The Eurace@Unibi Model

Abstract

Dawid H, Gemkow S, Harting P, van der Hoog S, Neugart M. Agent-Based Macroeconomic Modeling and Policy Analysis: The Eurace@Unibi Model. In: Chen S-H, Kaboudan M, Du Y-R, eds. The Oxford Handbook of Computational Economics and Finance. New York: Oxford University Press; 2018: 490-519.Agent-based simulation models are a relatively new addition to the tool-box of macroeconomists. The aim of this chapter is to review work that has been carried out in recent years. Particularly, we present the Eurace@Unibi model and set it into perspective with other agent-based macroeconomic models. Besides presenting a sketch of the Eurace@Unibi model, we show how agent-based models can be used to identify economic mechanisms, and how we have applied them for spatial policy analysis. Our assessment is that agent-based modelers have passed the stage of a proof-of-concept. It has been shown that new kinds of insights can be obtained using such an approach complementing established modeling approaches. We conclude by pointing towards potentially fruitful areas of agent-based macroeconomic research