A model for a simple Luhmann economy

Authored by A Fleischmann

Date Published: 2005-03

Sponsors: No sponsors listed

Platforms: Microsoft Excel Microsoft Visual Basic

Model Documentation: Other Narrative

Model Code URLs: Model code not found

Abstract

The core of this work is the definition of an agent-based model for a simple Luhmann economy based on publications of Niklas Luhmann. Using an implementation on a default personal computer the behaviour of the model is studied when assumptions regarding initial conditions are made. Fuzzy-c-means clustering is used as visualisation aid. The impact of the observation horizon (a model parameter determining how far agents can see) is studied interactively. Solution paths of the Luhmann economy originating from an initial endowment to equilibrium (when the economy settles down) are studied. The impact of model parameters determining the unevenness regarding the initial distribution of wealth is studied by Monte Carlo simulation. Niklas Luhmann's hypothesis, that the economy starts from and produces further inequality in order to continue (see Luhmann 1988., p. 112) could be reproduced by computer simulation. The main characteristic of the approach is the consideration of the cohesive structure of communication (i.e. one communicative act - many understanding observers) also prominent in Dunbar (1996, pp. 192-207). The model gives directions how to model further aspects of Niklas Luhmann's theory.

Tags

Agent-based modelling Luhmann economy fuzzy clustering