The SYMPHONY project develops an innovative platform for supporting policy-making, including the following key components: i) An agent based macroeconomic model and simulator for policy making, able to take into account disequilibrium dynamics and including credit and financial markets ii) An integrated system of social media mining and information markets, able to collect citizens’ economic expectations in order to inform policy makers and to calibrate the expectations of artificial agents in the agent-based model iii) A game interface for the agent-based model, in order to allow researchers, policy makers, stakeholders and citizens to access and interact with the model iv) A set of customized information markets in order to monitor and collect dynamically the expectation of the users on the simulated artificial economy. This allows for a dynamic feedback between policy and expectations. These components are designed to provide policy makers with a groundbreaking set of instruments able to involve citizens in the policy formation process and to increase their awareness about the various economic scenarios.
The main vision of the project is to design and develop an innovative tool for policy making based on an agent-based macroeconomic engine, and on the idea of collecting and exploiting citizens and stakeholders’ expectations. The SYMPHONY platform will be designed in order to improve the efficacy and the transparency of the decision making process. This main vision can be achieved through the following set of objectives.
The developed ICT tools would constitute a significant innovation in web based public services. They will be able to involve citizens and younger generations as stakeholders in the process of gathering data and analyzing the impact of models in policy decisions. In particular, we aim to develop:
Social media mining tools and techniques able to collect and analyze relevant information and human sentiments from web, social networks, blogs, news stream, etc. Web-based information markets able to solicit and aggregate citizens’ expectations on specific issues. An agent-based artificial economic world with human-machine interfaces based on serious games.
SYMPHONY will allow considering a richer characterization of the expectations formation process and of expectations measurement. Rational expectations theory, as a response to the Lucas critique, has brought macroeconomic analysis a long way over the past four decades, but there is a clear need to re-examine this assumption and to move forward. Agent-based modeling constitutes the suitable theoretical framework for this kind of task, due to the presence of many boundedly rational heterogeneous agents, which act according to distinctive behavioral rules. However, the framework proposed by SYMPHONY aims at giving a more articulated and innovative response, based on the integration of an agent-based model with the nowadays available technology that allows citizens’ participation. In this way, the fact that structural relationships in economics are generally not invariant with respect to changes in policy, pointed out by Lucas as a restriction of econometric models, becomes a resource in SYMPHONY’s policy platform, which provides for an interactive system of expectations collection through information markets.
To provide empirical foundations of expectation definition and formation in agent-based modeling by means of social media mining and web-based information markets outcomes. To design and study a multi-country agent-based model and simulator, where agents’ expectations are driven by social media mining and information markets. To get new insights about the interplay between the policy making process and expectation formation by citizens, this could shed new light upon both the Lucas critique and Goodhart’s law.
SOCIETAL OBJECTIVES To support the progress and advancement of the techno-economic-society with a complex and global approach to decision making. In particular, we aim at:
Considering behavioral and societal aspects when designing economic policies, by collecting and including in the model citizens’ sentiments, beliefs and opinions. Enhancing the transparency of the policy making process by providing a web based open instrument where stakeholders, including citizens, can actively participate by testing different policy hypothesis and trading in interactive information markets that should provide valuable feedback to policy makers Developing appropriate economic policies and regulatory frameworks for preventing and mitigating economic and financial crises and fostering an economically and ecologically sustainable growth path. Addressing these objectives will increase the transparency of the policy making process, help citizens to engage, and improve the credibility and effectiveness of policy institutions. Interesting effects should emerge from the interplay and feedback between citizens’ expectations and policy makers decisions. In particular, players/citizens revise their initial expectations based on the serious game outcomes; this change is captured by interactive information markets and properly exploited by policy makers with updated policy decisions. A new iteration of expectations revisions and new policy decisions could then start. A virtuous cycle could be determined at the end, where citizens’ expectations are aligned with policy makers’ decisions and fulfilled.
This will allow us to better understand the complexity of our economic and social system in order to allow coherent decision making for sustainable growth.