DISADIST-ABM: 📢Open positions

With Anton Pichler and @maria-drc.bsky.social we got a grant to model the well-being impacts of natural disasters beyond standard economic measures.

We are looking for a 3-year PhD student and 2-year postdoc, deadline 15/01.

More info 👇
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This is not the first paper having this idea, but it is the first that quantitatively tests the synchronization hypothesis. It also provides an eigenvalue-eigenvector decomposition that helps understand how synchronization and shocks interact through the trade network.

The empirical level of comovement can only be matched by a combination of exogenous shocks and endogenous cycles. Shocks alone cannot generate enough comovement, as is well-known in international macroeconomics. Thus, business cycles are at least in part endogenous.

If business cycles are exogenous, economies live in stable steady states and positive correlation of economic activity ("co-movement") comes from shock propagation. If they are endogenous, co-movement comes from synchronization of non-linear dynamics through trade linkages.

A debate that is almost as old as economics itself is what recessions and booms originate from. Are they driven by shocks external to the economy, like natural disasters, or by forces internal to the economy, such as debt accumulation? Are business cycles exogenous or endogenous?

If business cycles are (at least partly) caused by forces endogenous to the economy, rather than by exogenous shocks, it is much easier to explain why economic activity tends to co-move across countries.

New paper in JEBO: authors.elsevier.com/a/1kB5Vc24b7...

🧵👇

📢**A master-level course on complexity economics** Over the last few months, I’ve taught a 48-hours course in the master of Physics of Complex Systems at
@unito
. Here's an overview, and at the end I'll link to course materials - feedback welcome! 1/7

This paper is the result of 3 years of work of a team of economists and epidemiologists united by a common background in complex systems. Being all interdisciplinary scientists made it for a "deep" collaboration that went much beyond discipline-specific contributions. 11/12

We calibrate and validate our model on the first wave of Covid-19 in NY.The ABM reproduces epidemic & economic statistics at the aggregate level and across industries and income groups. Eg. we show that the poor got more unemployed but reduced consumption less than the rich 10/12

We rely on the quantitative interpretation of our results because the model is initialized from real-world, granular, data from the New York metro area, including the mobility traces of half a million people and the physical locations of shops, offices, construction sites.. 9/12

We also find that waiting too long to impose protective measures is counterproductive. This underscores a crucial diff. bw lockdown & behav. change: we don't know how much people reduce their exposure, while lockdown can be imposed as soon as needed for maximal effectiveness 7/12

Even when old, at-risk individuals change their behavior and stay home while young individuals keep consuming, the old get infected in their households and cut their consumption of customer-facing services more than the young keep consuming,leading to strong economic impact. 6/12

Both stricter lockdown and heightened behav. change save more lives and lead to more jobs lost among low-income workers, while they make less of a difference to high-income workers. This leads to striking spatial disparities in unemployment with strong reactions to Covid-19. 5/12

We find that, although lockdowns and behavior change affect epidemic spreading and economic impacts very differently, they lead to similar tradeoffs: both stricter lockdown and heightened behav. change increase unemployment and reduce fatalities by similar amounts. 4/12

More than 3 years since the outbreak of the Covid-19 pandemic, we still haven't compared lockdowns and behavior change in a model that is (i) joint epidemic-economic;(ii) granular in both epi & econ dimension; (iii) based on high-resolution real-world data. We fill this gap. 3/12

According to some, there were no tradeoffs between health & economy because letting Covid-19 spread would have also hurt the economy. According to others, letting individuals spontaneously change their behavior would have led to the best outcomes, also with no tradeoff. 2/12

Were lockdowns needed, or would spontaneous behavior change have led to better epidemic-economic outcomes? In our paper just out in Nature Human Behavior, we address this & other questions by building a highly granular & data-driven epi-econ agent-based model www.nature.com/articles/s41... 1/12