Computational Intelligence in Agent-Based Computational Economics

Abstract

Agent-based computational economics is the study of economics using agent-based modeling and simulation, which, according to [21], is the third way, in addition to deduction and induction, to undertake social sciences. An agentbased model is a model comprising autonomous agents placed in an interactive environment (society) or social network. Simulating this model via computers is probably the most practical way to visualize economic dynamics.In order to build autonomous agents, agent-based computational economists need to employ existing algorithms or develop new algorithms which can enable agents to behave with a degree of autonomy. Sections 1.2, 2 and 3 of the chapter will give a thorough review of the algorithmic foundations of ACE. We also introduce here the field known as computational intelligence(CI) and its relevance to economics. Section 4 then reviews the use of computational intelligence in agent-based economic and financial models. Section 5 gives some general remarks on these applications, as well as pointing to future directions. This is followed by concluding remarks in Sect. 6.