An Introduction to System Dynamics

Abstract

This chapter presents important concepts underlying the system dynamics modeling method. Following an initial definition of the term model, a summary of a successful system dynamics intervention is described. The key elements of system dynamics—stocks and flows—are explained. The process for simulating stock and flow models—integral calculus—is described, with an example of a company’s customer base used to illustrate how stocks change, through their flows, over time. A summary of dimensional analysis for stock and flow equations is provided before the second feature of system dynamics modeling—feedback—is presented. The chapter concludes by summarizing the system dynamics methodology, which is a five-stage iterative process that guides model design, development, test and policy design.