Spring, 2018 Esc 59M, Boğaziçi University

1

–  Problem articulation •  Theme selection •  Key variables •  Time horizon •  Dynamic problem identification (reference modes)

–  Formulation of dynamic hypothesis •  Initial hypothesis generation •  Endogenous focus •  Mapping

–  Formulation of a simulation model •  Specification of structure •  Estimation of parameters

–  Validation •  Validation of the structure •  Validation of the behavior

–  Policy design and evaluation •  Scenario specification •  Policy design •  What if analysis •  Sensitivity analysis •  Interactions of policies

–  Implementation Issues, deliberative processes

Overview of the System Dynamics method

Spring, 2018 Esc 59M, Boğaziçi University

2

Problem articulation (identification)

•  Theme selection •  Key variables •  Time horizon •  Dynamic problem identification (reference

modes)

Examples: A model designed to understand how the business cycles can be stabilized. Addresses only a set of limited issues. Problem: instability; cycles. Purpose: to stabilize. A model designed to explore policies to slow fuel use and mitigate global warming. Problem: increasing fosil fuel consumption. Purpose: to design policies to slow down fosil fuel consumption A model of the national economy: ill defined!

Spring, 2018 Esc 59M, Boğaziçi University

3

Illustrating reference modes

US oil production, consumption, imports and price over a 10 year time horizon

Spring, 2018 Esc 59M, Boğaziçi University

4

Illustrating reference modes

US oil production, consumption, imports and price over a 130 year time horizon (Davidsen 1988)

Spring, 2018 Esc 59M, Boğaziçi University

5

More reference modes

Emissions

0

1000

2000

3000

4000

5000

6000

7000

1900 1910 1920 1930 1940 1950 1960 1970 1980 1990

Global carbon emissions – million tonnes (http://cdiac.esd.ornl.gov/trends/emis/tre_glob.htm)

A multiple reference mode: North sea fish stocks – 1000 tonnes (UNEP – global environmental outlook 2000)

Spring, 2018 Esc 59M, Boğaziçi University

6

•  Work on a theme that you (and your

potential audience) are interested in

•  Model a problem. Not a system.

•  Be skeptic about the time horizon of your reference mode. Choose a time horizon several times as long as the longest time delays in the system.

•  Try to choose ”feedback” (closed loop) problems.

Useful principles in problem identification

Spring, 2018 Esc 59M, Boğaziçi University

7

Formulating a dynamic hypothesis

–  Initial hypothesis generation –  Focus on endogenous factors (arising

from within): Boundary selection –  Mapping (causal loop diagrams etc.)

Spring, 2018 Esc 59M, Boğaziçi University

8

Focus in endogenous factors

traffic volume

route capacity

average travelingtime

drivingattractiveness

number of trips

length of trips

car ownership

pressure toconstruct

route construction

route capacity

average travelingtime

number of trips

length of trips

car ownership

Spring, 2018 Esc 59M, Boğaziçi University

9

Examples for mapping

Spring, 2018 Esc 59M, Boğaziçi University

10

Examples for mapping

Spring, 2018 Esc 59M, Boğaziçi University

11

Overview of the modeling process

•  Formulation of a simulation model –  Specification of structure –  Assessment - estimation of parameters

•  Validation (testing the model)

–  Validation of the structure –  Validation of the behavior

parameter estimation

experimental design

•  Policy optimization

•  Policy design and evaluation –  Scenario specification –  Policy design –  Sensitivity analysis –  Interactions of policies

Spring, 2018 Esc 59M, Boğaziçi University

12

System dynamics and the scientific method:

•  Modeling is iterative

1. Problem Articulation(Boundary Selection)

3. Formulation4. Testing

5. PolicyFormulation& Evaluation

2. DynamicHypothesis

Results of any step can yield insights that lead to revisions in any earlier step