Consumption & class in evolutionary macroeconomics

Bernhard Rengs, Manuel Scholz-Wäckerle

Publication: Scientific journalJournal articlepeer-review

Abstract

This article contributes to the field of evolutionary macroeconomics by highlighting the dynamic interlinkages between micro-meso-macro with a Veblenian meso foundation in an agent-based macroeconomic model. Consumption is dependent on endogenously changing social class and signaling, such as bandwagon, Veblen and snob effects. In particular, we test the macroeconomic effects of this meso foundation in a generic agent-based model of a closed artificial economy. The model is stock-flow consistent and builds upon local decision heuristics of heterogeneous agents characterized by bounded rationality and satisficing behavior. These agents include a multitude of households (workers and capitalists), firms, banks as well as a capital goods firm, a government and a central bank. Simulation experiments indicate co-evolutionary dynamics between signaling-by-consuming and firm specialization that eventually effect employment and consumer prices, as well as other macroeconomic aggregates.
Original languageEnglish
Pages (from-to)229 - 263
JournalJournal of Evolutionary Economics
Volume29
DOIs
Publication statusPublished - 2019

Austrian Classification of Fields of Science and Technology (ÖFOS)

  • 102009 Computer simulation
  • 502027 Political economy
  • 502047 Economic theory

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