Welcome to Dr Lincoln's blog

Welcome for visiting my blog. Hope you enjoy the visit and always welcome back again. Have a nice day!


How advance of experiment economics - depending on capacity to model and understand models

Comments on Andreas Ortmann "Economic theories that have changed us: experimental economics", 11/07/2015

I am an economist myself by training, although my formal training was derived back to the early 1990s, more than 20 years old. As a result, I don't really know much about the experiment economics, although I have certainly heard of it and aware of it.

That said, it seems one cannot get too much into the differences between agents/people in formulating a realistic and workable economic model, simply because of the complexity that poses for modelling and to get consistent result. Everyone can be different from another. and there are billions of people on the world. People are consumers and agents, in economics. How can you model billions of different minds as individually represented ones in a model?

Again, having said that, it is possible to incorporate some key insights from experiment economics into slightly more complex economic models, so both worlds of the traditional economics and the experiment economics can be married into one workable model.

Most economic models are some abstraction of the real world, so they can capture the main aspects but simple enough to understand and apply. Of course, with computing technology advances more complex models are constructed to simulate the reality in more complex and more realistic ways.

No comments:

Post a Comment