IDEAS home Printed from https://ideas.repec.org/a/oup/apecpp/v37y2015i4p537-552..html
   My bibliography  Save this article

Building Economic Models Corresponding to the Real World

Author

Listed:
  • Ray Huffaker

Abstract

Increasingly, there are calls to audit models used in public policy for how accurately they portray the reality facing policy makers. Although models cannot be logically verified as accurate representations of reality, past work concludes that modelers can reasonably demonstrate the degree of correspondence. How to establish real-world correspondence remains an open question. This paper outlines a framework of pre-modeling data diagnostics to provide evidence of correspondence. The scheme—based on Nonlinear Time Series Analysis—provides a rigorous benchmark for specification and testing of policy models that reduces the likelihood that a misspecified model is discredited by an unanticipated crisis.

Suggested Citation

  • Ray Huffaker, 2015. "Building Economic Models Corresponding to the Real World," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 37(4), pages 537-552.
    • Handle: RePEc:oup:apecpp:v:37:y:2015:i:4:p:537-552.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/aepp/ppv021
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Huffaker, Ray G., 2010. "Phase Space Reconstruction from Economic Time Series Data: Improving Models of Complex Real-World Dynamic Systems," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 1(3), pages 1-10, October.
    2. Berg, Ernst & Huffaker, Ray, 2015. "Economic Dynamics of the German Hog-Price Cycle," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 6(2), pages 1-17, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Riley Post & Darren Hudson & Donna Mitchell & Patrick Bell & Arie Perliger & Ryan Williams, 2016. "Rethinking the Water-Food-Climate Nexus and Conflict: An Opportunity Cost Approach," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 38(4), pages 563-577.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ray Huffaker & Garry Griffith & Charles Dambui & Maurizio Canavari, 2021. "Empirical Detection and Quantification of Price Transmission in Endogenously Unstable Markets: The Case of the Global–Domestic Coffee Supply Chain in Papua New Guinea," Sustainability, MDPI, vol. 13(16), pages 1-18, August.
    2. Berg, Ernst & Huffaker, Ray, 2015. "Economic Dynamics of the German Hog-Price Cycle," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 6(2), pages 1-17, July.
    3. Huffaker, R. & Canavari, M. & Muñoz-Carpena, R., 2018. "Distinguishing between endogenous and exogenous price volatility in food security assessment: An empirical nonlinear dynamics approach," Agricultural Systems, Elsevier, vol. 160(C), pages 98-109.
    4. Richard Aspinall & Michele Staiano & Diane Pearson, 2021. "Emergent Properties of Land Systems: Nonlinear Dynamics of Scottish Farming Systems from 1867 to 2020," Land, MDPI, vol. 10(11), pages 1-27, November.
    5. Tapia Cortez, Carlos A. & Hitch, Michael & Sammut, Claude & Coulton, Jeff & Shishko, Robert & Saydam, Serkan, 2018. "Determining the embedding parameters governing long-term dynamics of copper prices," Chaos, Solitons & Fractals, Elsevier, vol. 111(C), pages 186-197.
    6. Duden, C. & Offermann, F., 2019. "Farmers' risk exposition and its drivers," 171st Seminar, September 5-6, 2019, Zürich, Switzerland 333722, European Association of Agricultural Economists.
    7. C. A. Tapia Cortez & J. Coulton & C. Sammut & S. Saydam, 2018. "Determining the chaotic behaviour of copper prices in the long-term using annual price data," Palgrave Communications, Palgrave Macmillan, vol. 4(1), pages 1-13, December.
    8. Berg, Ernst, 2017. "Impacts of Inventory Management on Price Volatility in Agricultural Commodity Markets: Insights from a System Dynamics Model," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 261281, European Association of Agricultural Economists.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:apecpp:v:37:y:2015:i:4:p:537-552.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.