Ep. 231: J. Doyne Farmer on Making Sense of Chaos
Macro Hive Conversations With Bilal Hafeez
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Redefining Economic Models
This chapter critiques traditional economic models, particularly DSGE models, highlighting their unrealistic assumptions and limitations in predicting economic outcomes like the 2008 financial crisis. It presents complexity economics as an alternative approach that uses agent-based modeling to better reflect real-world behaviors and market dynamics. The discussion emphasizes the potential of data-driven techniques to improve predictive capabilities in trading and financial markets.
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