Expanding the Range of Behavioral Factors in Economic Simulations
Title:
Expanding the Range of Behavioral Factors in Economic Simulations
Author:
Jeffrey, H. Joel
Appeared in:
Journal of behavioral finance
Paging:
Volume 7 (2006) nr. 2 pages 97-106
Year:
2006-06-01
Contents:
Economic simulations typically focus almost exclusively on economic variables. If non-economic factors are included at all, it is usually in some form of utility function calculation. This paper presents a model that allows formal specification of a much broader range of factors, processes, and quantities involved in human communities—families, businesses, ethnic groups, nations, work teams, cultures. The phenomena include the hierarchically structured social practices of the group, the principles that underlie choices in the community, and the recognizable positions or statuses in the community. This allows us to model intrinsic or expressive behavior, capturing the concept of multi-aspect identity and the impact of the principles of the group on individual behaviors, all in formal and quantitative form. Having these factors represented formally enables the creation of significantly more realistic simulations incorporating a much wider range of variables, particularly when the economic facts and quantities of interest are affected by and affect several other kinds of factors that are not, on their face, economic.
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