Abstract for: An Introduction to Macroeconomic Modeling - Accounting System Dynamics Approach
Macroeconomics is one of the core subjects in social science and behaviors of marcoeconomy such as the recent financial crisis affect all of us. With the help of system dynamics method, this workshop tries to explore the macroeconomic system structure and its complex behaviors by introducing a step- by-step construction of macroeconomic models based on the accounting system dynamics approach. Specifically, participants will learn the following modeling methods: double-entry booking/accounting system dynamics (which is itself helpful for business modeling), money supply by the central bank and creation of credit process through a fractional reserve banking system, Keynesian macroeconomic models, including IS-LM model and an integrated macroeconomic model of real and monetary sectors. All models are distributed in the class, which run on Vensim Model Reader, a free shareware for PC and Mac. Participants are recommended to download it and bring their laptops. Yet no knowledge of Vensim Software is required, not to mention economics. Running the models step-by-step, participants are invited to the world of macroeconomic system, and explore a complex structure of macroeconomic behaviors, through simulation, with their own working hypotheses of macroeconomic scenarios.