(f) Ecology  ABMs have been applied to a number of ecological problems involving the interaction of multiple agents with each other and with the environment. In the 1990s, ABMs were applied to population and resource dynamics and migration patterns (Grim (1999)). For example, there is now a large body of work on ABMs of marine organisms (Werner et al (2001)), simulating how these organisms are moved around by ocean currents and how they interact in food webs. Model-derived fish spawning locations have been found to coincide with observed spawning locations of fish (Heath and Gallego (1998)). These models have also been used to simulate the effects of hypothetical interventions, such as the impact of introducing new predatory species to eliminate pests, different techniques for managing fish stocks, or the impact of contamination of marine eco-systems (Madenjian et al (1993)). ABM techniques have been applied to the management of forests, by simulating the establishment, growth, and death of individual trees, taking account of tree-tree interactions as they compete for resources. These models have been used to help forest management and assess the systemic impact of environmental changes, such as widespread deforestation. 13  13  See Liu and Ashton (1995). 18  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  18  Figure 12: Migrating animals  Figure 13: Oceanographic patterns  Source: Bjørn Christian Tørrissen (CC-BY-SA-3.0). Wildebeest on Source: Bruno de Giusti (CC-BY-SA-2.5-IT). Fish (image  the Serengeti (image available here). available here).
7  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  7  Chart 1: Range of GDP forecasts in 2007Q4  Chart 2: Forecasts for World Growth by the IMF since 2007  Latest vintage of GDP data  Year on year growth 4 3  Apr-07 Oct-08 Apr-10 Oct-11 Apr-13  Oct-07 Apr-09 Oct-10 Apr-12 Oct-13  Apr-08 Oct-09 Apr-11 Oct-12 Apr-14  Percent year on year 7 6  2 November 2007 IR  5 1 4 0  3  -1  2  -2  1  -3  0  -4  -1  -5  -2  2002 2003 2004 2005 2006 2007 2008 2009 2010 2011  2000 2002  Source: Bank of England November 2007 Inflation Report; Bank of England Survey of Economic Forecasters. Source: IMF World Economic Outlook. 2004 2006  2008  2010  2012 2014  2016  For me, this is not really a defence. Economics is important because of the social costs of extreme events. Economic policy matters precisely because of these events. If our models are silent about these events, this jeopardises the very thing that makes economics interesting and economic policy important. It risks squandering the human capital endowment the financial crisis has bestowed. Even if some of the post-crisis criticism of workhorse macro-economic models is overdone, it still raises the question of whether new modelling approaches might be explored which provide a different lens on the world or which better match real-world dynamics.