THE MODELING STRATEGY OF COMPLEXITY ECONOMICS WITH IMPLICATIONS IN OPTIMAL POLICY-MAKING

Abstract

Expanding on previous work done in the domain of modeling complexity economics we formulated a strategy to use as a modeling guide for modeling complexity economics. We identified two cases of complexity economics modeling and using common variables used in many studies demonstrated typical pitfalls and gaps in related to the confounding effects of various variables which can lead to misleading results. Since the framework of complexity economics is essentially boundless, we also introduced a limitation for modeling optimal policymaking within this framework which we believe will guide future research into taking steps to unveil the true potential of modeling with decreasing abstraction layers.