Complex agent-based macroeconomics: A manifesto for a new paradigm

Abstract

This article discusses some issues and challenges facing modern macroeconomics. We argue for the necessity to replace the reductionist approach at the heart of mainstream DSGE models with an approach rooted on the science of complexity and agent-based modelling. To strengthen and exemplify our position, we show a simple example and introduce several items for a research agenda along these lines. © 2010 Springer-Verlag.