Rediscovering the Economics of Keynes in an Agent-Based Computational Setting

The aim of this paper is to use agent-based computational economics to explore the economic thinking of Keynes. Taking his starting point at the macroeconomic level, Keynes argued that economic systems are characterized by fundamental uncertainty an uncertainty that makes rule-based behaviour and reliance on monetary magnitudes more optimal to the economic agent than profitand utility optimization in the traditional sense. Unfortunately more systematic studies of the properties of such a system was not possible at the time of Keynes. The system envisioned by Keynes holds a lot of properties in commen with what we today call complex dynamic systems, and today we may apply the method of agent-based computational economics to the ideas of Keynes. The presented agent-based Keynesian model demonstrate, as argued by Keynes, that the economy can selforganize without relying on price movement as an equilibrating factor.In our implementation selforganization does, however, not mean a steady long run equilibrium, but a tendency to generate cycles.