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[screen shot]

If clicking does not initiate a download, try right clicking or control clicking and choosing "Save" or "Download".(The run link is disabled for this model because it was made in a version prior to NetLogo 6.0, which NetLogo Web requires.)


The game is a simulation game of a small economic community in a poor country. The persons walking around are turtles. As they meet each other, they do economic transactions. Basically, they buy food for euros. If they are getting richer, their interest is going more to buying luxury goods (symbolized by diamonds).



Start the simulation by clicking setup. When clicking go, the turtles start moving and trading. The keep on doing so as long as the go-button remains 'pressed'. Turtles cannot die from hunger if they do not trade. However, they can come to a standstill if they go bankrupt.

The game allows you to monitor the economic success via a graph and several counters. Will sliders you can increase or decrease several parameters to see their effect on the economy or the distribution of wealth.

Short explanation on the basic elements:

black square with thingies
This is the community, and here the turtles move around. Red turtles are members, greens are non-members, but for the moment this doesn't have any meaning. The more hungry they are, the paler they look. You can slow down the simulation by using the slider on top of the black area.

buttons: Setup
resets everthing to initial values, and releases 100 turtles in the “wild”.

buttons: Go
if clicked, the turtles start moving. When they meet another, they might trade. But not always, sometimes they just don't have enough money, don't trust each other, etc etc.

In the left of the screen are all the monitors. They monitor certain counters and variables. For details, see "Things to notice"

In the right of the screen, below the setup and go buttons, are the sliders. They allow you to manipulate certain parameters. For detailed description, see "To manipulate".

At the bottom of the screen there are various graphs. For details, see "things to notice".



Numbers: Persons
This is the total number of turtles.

Numbers: Hungry
This is the total number of turtles being hungry. A turtle is hungry when his energy falls below 10. It has no further consequences for the turtle, except that turtles who are short on food, will of course not buy luxury, but only food. They will not invest either. The less energy the turtle has, the paler its color is.

Numbers: members
without any meaning yet

Numbers: bankrupt
A turtle who cannot pay back the debts he made, and who's debt is running out of hand, will be declared bankrupt. He looses everything but 10 euro's of pocket money, and cannot move or trade anymore. After several rounds (default 100) the bankrupcy expires, and the turtle is allowed to move and trade again.

Totals: trade
The sum of all traded euro's since the setup of the simulation. This monitor gives the number in thousands of euro's.

Totals: trans
The total number of transactions done, in thousands, since the setup of the simulation.

Totals: €
The total amount of euro's in the community. That is: in the pockets of turtles, on their bank savings accounts, and in the bank's profit.

Totals: € out
The total sum of euro's which left the community, because of payments to persons from outside. For the time being, the only way a euro can leave the community, is because it is paid to a foreign mineworker.

Totals: € max
The maximum amount of euro's a turtle has.

Totals: richest
the wealth of the richest turtle. Wealth is defined as the sum of euro's in pocket and in savings, minus the debts, plus the value of the luxury goods (diamonds) it bought. The value of stock (raw diamonds) is not counted, as they might be unsellable.

Diamonds: invested
Diamonds symbolize luxury goods. Before they can be sold, they must be produced. They are produced by turtles who do an investment. An investment is done by paying a certain amount of money, and receiving 10 raw diamonds for it. These diamonds can be sold to other turtles, with profit (or loss). This monitor shows the total amount of euro's which has been invested yet.

Diamonds: produced
This is the total amount of diamonds which have been produced as raw diamonds. Per investment, 10 raw diamonds are produced.

Diamonds: sold
Diamonds need to be sold as luxury goods, otherwise the investors will loose their investment. This is the total amount of diamonds which were sold to other turtles.

Diamonds: price
This is the average price for a diamond. Diamonds don't have fixed prices, as they are luxury goods, they are always wanted, as long as there is surpluss money available for it. The customer pays whatever he has available, but keeps a certain buffer for not running the risk of getting hungry. When the price falls below a certain limit, the producers will not sell anymore.

Medians: energy
the median energy of turtles

Medians: euro's
the median of the amount of euro's a turtle has. This is cash + savings - debts.

Banking: savings
A turtle which has more than a certain limit of euro's in cash, goes to the bank and deposits this in his savings account. This monitor is the sum of all savings accounts. The money in savings is available for loans.

Banking: loanfund
The loanfund is the amount of money available for loans. This is the money available in savings minus the bank reserve + the bank profit.

Banking: loans
The sum of all open loans (including interest).

Banking: interest
All interest paid up to now.

Banking: profit
The profit from the bank comes from interest payments. However, the profit is used to cover losses from bankrupcies, and a certain percentage can be shared amongst holders of savings accounts with positive balance.

Banking: shared
This is the summed amount of money which has been shared amongst holders of savings accounts. So it is the profit for savings account holders.

Graphs: Lorentz curve
This graph shows the (in)equity of the distribution of wealth. Both wealth and the percentage of people owning that wealth are ranked, and plotted against each other. So, for example, if the poorest 10% of the people all together own 5% of all the wealth, then this is represented in the graph by the point (10,5).
If there is a 100% equity amongst the people, and there is exactly 100 euro's in the population, to be spread amongst 100 persons, then this curve would then 1% would own 1%, 2% would own 2%, 10% would own 10%, etc etc. So this curve would follow the ideal black line, which goes from the lower left corner to the upper right corner.
As soon as there is some form of inequity, the curve falls below the black line. The bigger the area between the curve and the line, the more inequity there is. Total inequity, where one person would own all 100 euro's, would show a curve in the shape of a mirrored L (always following the x-axis, until x=100, and then jumping up to y=100).

Graphs: Wealth Distribution
The graph shows two histograms of the wealth distribution: the green bars are the total wealth (= cash + savings + value of bought diamonds - open debts); the yellow line is the total amount of euro's (= cash + savings - open debts).

Graphs: engery
This graph shows the median energy over time. Time graph x-axisses are always in "plotpoints", where one plotpoint is 100 turtle moves.

Graphs: Wealth / time
The development of wealth over time. Wealth is defined as cash + savings + value of bought diamonds - open debts; Time graph x-axisses are always in "plotpoints", where one plotpoint is 100 turtle moves.

Graphs: Return of Investments
This graph plots each investment done for its returns. As soon as an investment is done, it appears in the graph as a dot. The x-axis shows the time since the investment was done. The y-axis shows the overall balance for this investment. This is defined as the euro's earned by selling the diamonds which came from this investment, minus the initial amount invested, minus the paid interest over the loan for the investment. The black horizontal line in the plot is representing the zero level: as soon as a dot appears above this line, there is a profit.

Graphs: Gini-index / time
This graph shows the inequity developing over time. Used is the Gini index, which follows from the Lorenz curve. The Gini index is the area between the curve and the line in the Lorenz graph, divided by the total area below the black line of perfect equality (this total area below the black line is always 0.5). The extreme values for the Gini index are 0 in case of perfect equity (the curve and the line would be the same, so the area between them would be 0, so the Gini index would be 0), and 1 in case of complete inequity (the mirrored L, resulting in a Gini index of 0.5/0.5 = 1).
So the Gini index is a measurement for inequity, being 0 when there is maximum equity, and being 1 when there is maximum inequity.

Graphs: debts / time
This graph shows the development of debts over time. Three lines are plotted:
* red: the total of open debts (so including interest)
* orange: the original debt amounts without interest. When a debt is repaid, first the original amount is paid back.
* violet: the total loan fund available for loans

Graphs: Trade / time
this is the basic graph depicting economic development in our community. Don't let yourself be fooled by huge variations: that is the way economy is. Look at the overall trends. When there is economic growth, you will recognize it for sure in the graph, after some time.


Slider: investmentThreshold:
this shows the costs of investment. When doing an investment, a turtle will have to pay this amount. In practice, a turtle also wants to keep so pocket money for food, so this means that a turtle having an amount of euros above this number + 50, will start investing it in his business, thus spending most of his money, but improving his chances to earn more later on. A good value to start with would be 400.

Slider: %InvestOut:
When investing, the money is spend on producing raw diamonds from the mines. In fact, the money is paid to mineworkers. This slider determines how many of these mineworkers are coming from outside of our own community. If it is set on 40%, it means that 40% of the mineworkers are from outside; so 40% of the money is gone, and 60% flows back and is redistributed amongst turtles of the own community.

Slider: BankReserves:
This is the bank reserve in percentages. If a bank wants to offer loans, it normally uses money which has been deposited in savings accounts. However, this money is owned by its holders of savings accounts, and must be paid to them as soon as the holder wants to withdraw it. Still, the bank uses it, in the knowledge that not all of the account holders will want to withdraw their money at the same time. So money deposited in savings accounts is usually reallocated, by lending it out several times to other people. In this way, money is created by the bank.
But for protection of the account holders, the governments usually sets a percentage, which the bank is obliged to keep. If this slider is 25%, it means that the bank is allowed to use 75% of all the money in savings accounts for providing loans, and 25% must be kept in cash, in case the account holders come and get their money.
A good value for this slider might be 25%.

Slider: %BankFinancing:
In our community, the bank is only a savings and investment bank; it does not provide loans for consumption, only for investments. This slider determines which percentage of an investment can be financed via the bank. If this slider is on 30%, it means that the turtle doing an investment, must get 70% of the amount from its own money, and 30% of the money can be obtained via a loan. A good value for this slider might be 50%.

Slider: interest%:
This slider shows the percentage of interest over loans. It is the interest percentage per plotpoint (= 100 turtle moves).

Slider: profit-share-%:
This slider shows to what extend the profits of the bank are shared amongst holders of savings accounts with a positive balance. When profits are above a certain safety limit, they can be shared amongst holders of a positive balance. In such a case, x % of the profit is put apart each plotpoint (= 100 turtle moves), and distributed over the holders of savings accounts with positive balances, in such a way that everybody receives an equal percentage over his current balance.


You can run the model with the following settings:

1) Normal:
investmentThreshold = 400
%InvestedOut = 0
Bankreserves = 25
%BankFinancing = 50
Interest% = 2.0
profit-share-% = 10.0

This is the economy under normal circumstances. Run the model and see the following happening:
- over time, there is a quite a strong growth in wealth (curve wealth / time)
- gini index slightly drops, so as everybody is getting more rich, there is less inequality
- investments are done, and loans over them are paid back (curve debts / time)
- investments have positive returns (curve Return of Investments)

2) No investment:
investmentThreshold = 500
%InvestedOut = 0
Bankreserves = 25
%BankFinancing = 0
Interest% = 2.0
profit-share-% = 10.0

By putting the investmentThreshold on maximum, and the %BankFinancing on 0, we can be sure that there will be no investments. Note that the model is in a steady state: there is no economic growth, nor economic shrinking.
- the amount of euro's in the economy does not change (monitor Totals: €)
- The distribution of wealth almost immediately stabilizes around a value just above 0.5 (curve gini index).

3) The effect of bank reserves and investments
After running the model for a while with the settings of item 2), do the following:
- Try and move the bank reserve slider to 100%: the loanfund drops immediately to 0.
- Move back the bank reserve slider to 25%, and move the %BankFinancing slider to 50%. Soon there will be open loans in the simulation. As soon as there will be an open loan, the total amount of euro's in the simulation will vary, and wealth will increase. The more open loans, the more euro's available, and the more wealth developing.
- This can be sped up by decreasing the bank reserves. You may also notice a slight economic growth in the growth / time curve, as a result of this.

4) The effect of outflowing money
Continue with the same situation, but now move the slider "%InvestOut" to the maximum. You can also try this by starting anew with the settings of 1), but %InvestOut on 100. The result of this, is that all of the invested money is flowing out of the community. The effects of this are dramatic.
- total sum of euro's decreasing (monitor: totals: €)
- gini goes up again, so more inequality
- Return of Investments drops, leading to bankrupcies
- wealth curves tops of, and drops
- economic growth drops
- energy drops, hunger rises.
- investments stop; no more investments. If you try this from the start with a fresh setup, you will see a wave of first investments, which soon stops, and no investments will be done anymore.
This crisis is because all of the money invested is flowing out of the community. The investors let the money flow out, but are only focusing on the internal market, which is in stagnation because of a shortage of money.

5) the effect of too high interest rates
investmentThreshold = 400
%InvestedOut = 0
Bankreserves = 25
%BankFinancing = 50
Interest% = 10.0
profit-share-% = 10.0

See for yourself: from a debt crisis with several bankrupcies, a real economic crisis results. The most dramatic effects can be found when running the model for some time with normal settings (1), and then increasing the interest rate to extreme values.
Try and find out what is the maximum interest percentages which seems to result in a still stable economy. Which other sliders are influencing this?


* market:
in the determination of prices, there is no market. The model could be greatly improved if the prices would be determined by supply and demand. Also costs of interest should be calculated into the prices.

* sensible decision making and experiences:
at this moment, the turtles are not learning anything from their own and other's experiences. For example: a turtle just tries and gets a loan, even if the interest rates are outrageous, and everyone else getting a loan has gone bankrupt.

* more realistic money flows inside and outside the community
Yet, there is only one possibility to let money flow to outside: paying mineworkers from outside. This is of course not at all realistic: as wealth rises (or drops), turtles might have more reasons to go and buy goods from outside, or even to start investing outside (outflowing money).
At the moment, there can never be any money flowing in. This is even more unrealistic: turtles might find a job outside, or might sell their products to the outside world.

* introduction of an alternative money system


This section could point out any especially interesting or unusual features of NetLogo that the model makes use of, particularly in the Procedures tab. It might also point out places where workarounds were needed because of missing features.


This section could give the names of models in the NetLogo Models Library or elsewhere which are of related interest.


This section could contain a reference to the model's URL on the web if it has one, as well as any other necessary credits or references.

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