A Process for the Development and Application of Simulation Models in Applied Economics

25 Pages Posted: 24 Jan 2013

See all articles by Graeme J. Doole

Graeme J. Doole

The University of Western Australia - School of Agricultural and Environment

David J. Pannell

University of Western Australia

Date Written: January 2013

Abstract

Simulation models are widely used in applied economics to improve understanding of how a system could behave under different conditions. However, the potential degree to which such models can influence decision making depends on their ability to provide an adequate description of the important elements of a given problem. A systematic and robust procedure for the development and application of such models in agricultural, ecological, environmental and natural resource economics is presented. This process is based on the authors’ experience across a broad range of model types and applications and extensive literature review. The practical impact of simulation models is argued to be greater where stakeholders and technical experts are consulted extensively throughout the modelling process.

Keywords: modelling, sensitivity analysis, stakeholders, validation

Suggested Citation

Doole, Graeme J. and Pannell, David J., A Process for the Development and Application of Simulation Models in Applied Economics (January 2013). Australian Journal of Agricultural and Resource Economics, Vol. 57, Issue 1, pp. 79-103, 2013. Available at SSRN: https://ssrn.com/abstract=2206093 or http://dx.doi.org/10.1111/j.1467-8489.2012.00607.x

Graeme J. Doole (Contact Author)

The University of Western Australia - School of Agricultural and Environment ( email )

Nedlands, Western Australia 6907
Australia

David J. Pannell

University of Western Australia ( email )

35 Stirling Highway
Crawley, Western Australia 6009
AUSTRALIA
(08) 9844 8659 (Phone)
(08) 9844 8659 (Fax)

HOME PAGE: http://www.general.uwa.edu.au/u/dpannell/welcome.html

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