Behavior SIM#
This is the documentation of the behavior module of the SIM model from Godley & Lavoie (2006, Chapter 3), detailing the equations of the model.
Initialization#
- BehaviorGL06SIM.initialize()[source]
Initialize the behavior of the Godley-Lavoie 2006 SIM model.
Within the book the initialization is generally to set all non-scenario variables to zero. Accordingly
Equations
\begin{align} C_d(0) &= C_s(0) = 0 \\ G_d(0) &= G_s(0) = 0 \\ T_s(0) &= T_d(0) = 0 \\ N_s(0) &= N_d(0) = 0 \\ YD(0) &= 0 \\ W(0) &= 0 \\ H_s(0) &= 0 \\ H_h(0) &= 0 \end{align}Dependency
Sets
ConsumptionDemand
ConsumptionSupply
GovernmentDemand
GovernmentSupply
TaxSupply
TaxDemand
LabourSupply
LabourDemand
DisposableIncome
WageRate
MoneySupply
HouseholdMoneyStock
Main Simulation Loop#
- BehaviorGL06SIM.government_supply(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
In the model it is assumed that the supply will adjust to the demand, that is, whatever is demanded can and will be produced. Equation (3.2) in the book.
- Parameters:
Equations
\[G_s(t) = G_d(t)\]Dependency
scenario: GovernmentDemand
Sets
GovernmentSupply
- BehaviorGL06SIM.labour_demand(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
We can resolve the labour demand from the national income equation, together with the consumption demand (+ disposable income) and the government demand knowing that labour demand is equal to labour supply.
- Parameters:
Equations
\[N_d(t) =\frac{\alpha_2 H_h(t-1) + G_d}{W(t)(1-\alpha_1(1-\theta))}\]Dependency
prior: HouseholdMoneyStock
scenario: GovernmentDemand
scenario: WageRate
Sets
LabourDemand
- BehaviorGL06SIM.labour_supply(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
In the model it is assumed that the supply will be equal to the amount of labour demanded. Equation (3.4) in the book
- Parameters:
Equations
\[N_s(t) = N_d(t)\]Dependency
state: LabourDemand
Sets
LabourSupply
- BehaviorGL06SIM.tax_demand(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The tax demand is a function of the tax rate, the labour supply, and the wage rate. Equation (3.6) in the book.
- Parameters:
Equations
\[T_d(t) = \theta N_s(t) W(t)\]Dependency
parameters: TaxRate
state: LabourSupply
scenario: WageRate
Sets
TaxDemand
- BehaviorGL06SIM.tax_supply(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
In the model it is assumed that the supply will be equal to the amount of taxes demanded. Equation (3.3) in the book
- Parameters:
Equations
\[T_s(t) = T_d(t)\]Dependency
state: TaxDemand
Sets
TaxSupply
- BehaviorGL06SIM.disposable_income(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The disposable income is the wage bill minus the taxes. Equation (3.5) in the book.
- Parameters:
Equations
\[YD(t) = W(t) N_s(t) - T_s(t)\]Dependency
state: LabourIncome
state: TaxSupply
Sets
DisposableIncome
- BehaviorGL06SIM.consumption_demand(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The consumption demand is a function of the disposable income, the propensity to consume income, and the propensity to consume savings. Equation (3.7) in the book.
- Parameters:
Equations
\[C_d(t) = \alpha_1 YD(t) + \alpha_2 H_h(t-1)\]Dependency
state: DisposableIncome
prior: HouseholdMoneyStock
Sets
ConsumptionDemand
- BehaviorGL06SIM.consumption_supply(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
In the model it is assumed that the supply will adjust to the demand, that is, whatever is demanded can and will be produced. Equation (3.1) in the book.
- Parameters:
Equations
\[C_s(t) = C_d(t)\]Dependency
state: ConsumptionDemand
Sets
ConsumptionSupply
- BehaviorGL06SIM.government_money_stock(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The government money stock is a function of the government demand, and the tax supply. Equation (3.8) in the book.
- Parameters:
Equations
\[H_s(t) = H_s(t-1) + G_d(t) - T_d(t)\]Dependency
scenario: GovernmentDemand
state: TaxDemand
prior: GovernmentMoneyStock
Sets
GovernmentMoneyStock
- BehaviorGL06SIM.household_money_stock(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The household money stock is a function of the disposable income, the propensity to consume income, and the propensity to consume savings. Equation (3.9) in the book.
- Parameters:
Equations
\[H_h(t) = H_h(t-1) + YD(t) - C_d(t)\]Dependency
state: DisposableIncome
state: ConsumptionDemand
prior: HouseholdMoneyStock
Sets
HouseholdMoneyStock
- BehaviorGL06SIM.national_income(t: int, scenario: dict, params: dict | None = None, **kwargs)[source]
The national income is the sum of the consumption demand, the government demand, and the tax supply. Equation (3.10) in the book.
- Parameters:
Equations
\[Y(t) = C_s(t) + G_s(t)\]Dependency
state: ConsumptionSupply
state: GovernmentSupply
Sets
NationalIncome