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And yet, as simple as this is, four agents is more than you see in most "complex" DSGE models... This looks to me like they're applying deep RL to agent-based m
by Gimpei 6y ago
And yet, as simple as this is, four agents is more than you see in most "complex" DSGE models... This looks to me like they're applying deep RL to agent-based modeling. It does seem pretty silly now, but it could be promising. You don't have to restrict these agents to any neoclassical assumptions and there isn't any reason you couldn't introduce firms as well. The only limit is computational power. Macroeconomics tends to look down on agent-based modeling because it doesn't provide neat, closed form solutions. But I've never bought that the results from DSGE models are anything more than products of all their simplifying assumptions. After all, they seem to be the very definition of overfitedness with absolutely no predictive power. At least they're trying something new here.
- QuesnayJr 6y agoDSGE models are designed be solved on your laptop in 0.0001 seconds. There are more complicated models, like Krussell-Smith, but it's not clear that they help explain macroeconomics better. Agent-based modelling isn't more popular because they assume that the agents are very, very stupid. Also, not only do they not produce closed-form solutions, they don't tend to lead to clear statements at all. Also also, the leading agent-based modeler, Cars Hommes, is infinitely better published than most economists, so he's not suffering too bad.