Agent-based computational economics: methodology and its application in electricity market research

Abstract

Abstract--The restructured electricity market is a complex adaptive system and worldwide experiences show that market design is a complicated task. Recently, under the paradigm of Agent-based computational economics (ACE) a new research focus is forming and a large number of literatures are springing up, but there is still no the discussion on ACE's theoretical value and insufficiency in the research of electricity market in the hierarchy of methodology, therefore the author's research is an attempt in this aspect. By means of analyzing the evolution of economics methodology from mathematical deduction to simulation induction and their inherent relevance, the unique superiority of ACE on the level of methodology is expounded. The further selective survey on existing literatures shows that with the ACE model the marketization process can be understood clearly in deeper level and wider scope. Finally to give a reference to theoretical progress, the prospect application of ACE, especially its potential in China's electric sector restructuring is discussed.