Complex Systems in Economics and Where to Find Them

Gomes, Orlando; Gubareva, Mariya

doi:10.1007/s11424-020-9149-1

Cited by 22 publications

(7 citation statements)

References 57 publications

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“…Thus, underscoring the importance of alternative investments can provide attractive returns coupled with the desirable hedging attributes. Even before this pandemic, we have seen a surge in finance literature focused on factors such as sustainability, ethics, faith-based, environment friendly and socially responsible investing and financing decisions ( Umar, 2017 ; Shahzad et al, 2017 ; Umar et al, 2020a ; and Gomes and Gubareva, 2020 ). Consequently, we have seen the emergence of new assets such as Islamic finance assets and Environmental, Social, and Governance (ESG) securities.…”

Section: Introductionmentioning

confidence: 99%

Impact of the Covid-19 induced panic on the Environmental, Social and Governance leaders equity volatility: A time-frequency analysis

Umar

Gubareva

Tran

et al. 2021

Research in International Business and Finance

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We apply wavelet analyses to study how the Covid-19 fueled panic influenced the volatility of ESG (environmental, social and governance) leaders’ indices encompassing the World, the USA, Europe, China, and the Emerging Markets. We document intervals of the low, medium, and high coherence between the Coronavirus Panic Index and the price moves of the ESG Leaders indices. The low coherence intervals signify the diversification potential of ESG investments during a systemic pandemic such as Covid-19. We document differences in the pattern exhibited by various geographical indices highlighting their potential role for designing cross-geography hedge strategies, both now and in the future.

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Section: Introductionmentioning

confidence: 99%

Impact of the Covid-19 induced panic on the Environmental, Social and Governance leaders equity volatility: A time-frequency analysis

Umar

Gubareva

Tran

et al. 2021

Research in International Business and Finance

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“…In contrast to the forecast communities addressed by Petropoulos et al (2022), the general foresight and scenario analysis and scenario planning communities have long been more focussed methodologically on addressing uncertainty and strategically on improving decisionmaking (de Jouvenel, 1986;O'Mahony, 2014). Specifically with respect to economics, adopting scenario analysis is consistent with the long-established movement for "complexity economics" that views economies as complex systems subject to irreducible uncertainty (Gomes and Gubareva, 2021;Kirman, 2018;Farmer, 2012;Anderson et al, 1988;). This is also consistent with Hendry's conclusions on the effect of "location shifts" (Hendry, 2018) and with the emergent conclusion in the economic forecasting literature cited abovethat national economies, even in the short-term, defy prediction.…”

Section: Per Centmentioning

confidence: 99%

Time to build a new practice of foresight for national economies? Ireland, and uncertain futures in forecasts and scenarios

O’Mahony

Luukkanen

Vehmas

et al. 2023

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Purpose The literature on economic forecasting, is showing an increase in criticism, of the inaccuracy of forecasts, with major implications for economic, and fiscal policymaking. Forecasts are subject to the systemic uncertainty of human systems, considerable event-driven uncertainty, and show biases towards optimistic growth paths. The purpose of this study is to consider approaches to improve economic foresight. Design/methodology/approach This study describes the practice of economic foresight as evolving in two separate, non-overlapping branches, short-term economic forecasting, and long-term scenario analysis of development, the latter found in studies of climate change and sustainability. The unique case of Ireland is considered, a country that has experienced both steep growth and deep troughs, with uncertainty that has confounded forecasting. The challenges facing forecasts are discussed, with brief review of the drivers of growth, and of long-term economic scenarios in the global literature. Findings Economic forecasting seeks to manage uncertainty by improving the accuracy of quantitative point forecasts, and related models. Yet, systematic forecast failures remain, and the economy defies prediction, even in the near-term. In contrast, long-term scenario analysis eschews forecasts in favour of a set of plausible or possible alternative scenarios. Using alternative scenarios is a response to the irreducible uncertainty of complex systems, with sophisticated approaches employed to integrate qualitative and quantitative insights. Research limitations/implications To support economic and fiscal policymaking, it is necessary support advancement in approaches to economic foresight, to improve handling of uncertainty and related risk. Practical implications While European Union Regulation (EC) 1466/97 mandates pursuit of improved accuracy, in short-term economic forecasts, there is now a case for implementing advanced foresight approaches, for improved analysis, and more robust decision-making. Social implications Building economic resilience and adaptability, as part of a sustainable future, requires both long-term strategic planning, and short-term policy. A 21st century policymaking process can be better supported by analysis of alternative scenarios. Originality/value To the best of the authors’ knowledge, the article is original in considering the application of scenario foresight approaches, in economic forecasting. The study has value in improving the baseline forecast methods, that are fundamental to contemporary economics, and in bringing the field of economics into the heart of foresight.

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“…In addition, although BPP interventions increasingly recognize the importance and value of cultural differences when designing and implementing interventions (Henrich et al, 2010;Banerjee et al, 2019), the presumption of generalized or average attributes across intervention audiences may still fail to address the diversity of individual goals, incoming expectations and mental models, and choice contexts of assorted actor-agents in system contexts (Gomes & Gubareva, 2021). These various choice 'postures' or stances are frequently highly intertwined with other actors (Trenchard-Mabere, 2016) informed by personal lived experience (Spotswood & Marsh, 2016;Ewert & Loer, 2021), and continually evolving and adapting over time (Bickley & Torgler, 2021).…”

Section: Multistakeholder Environments and 'Choice Posture'mentioning

confidence: 99%

A model for choice infrastructure: looking beyond choice architecture in Behavioral Public Policy

Schmidt

2022

Behav. Public Policy

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Interventions that tackle ‘last mile’ behaviors in the form of improved choice architecture are fundamental to Behavioral Public Policy (BPP), yet far less attention is typically paid to the nature and design of underlying system conditions and infrastructures that support these interventions. However, inattention to broader conditions that impact participant engagement and intervention functionality, such as barriers to access that deter participation or perverse structural disincentives that reward undesirable behaviors, may not only limit the effectiveness of behavioral solutions but also miss opportunities to deliberately design underlying ‘plumbing’ – the choice infrastructure – in a way that improves overall system efficacy and equity. Using the illustrative case of civic policy in food licensure, this article describes how using a ‘SPACE’ model to address Standards, Process mechanics and policies, Accountability, Culture within systems, and Evaluative and iterative feedback can support the development of improved choice infrastructure, contributing to BPP problem-solving efforts by helping practitioners create system conditions that are more conducive to the success of behavioral solutions.

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Complex Systems in Economics and Where to Find Them

Cited by 22 publications

References 57 publications

Impact of the Covid-19 induced panic on the Environmental, Social and Governance leaders equity volatility: A time-frequency analysis

Impact of the Covid-19 induced panic on the Environmental, Social and Governance leaders equity volatility: A time-frequency analysis

Time to build a new practice of foresight for national economies? Ireland, and uncertain futures in forecasts and scenarios

A model for choice infrastructure: looking beyond choice architecture in Behavioral Public Policy

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