This paper introduces and discusses the concept of verbally formulated simulation models. Such models can operate with linguistic values as ‘high’, ‘rather high’, ‘low’ and ‘not low’, etc. as inputs. The output will be similarly verbally formulated. The stimulation procedure is based on a fuzzy set-theoretical semantical model of a fragment of English language, which converts verbal expressions into numerical quantities. The paper applies one particular semantical model in a simulation example. Verbal models may be more believable, or significant, than conventional system dynamic models, in that they adequately represent the fuzzy knowledge of the system which is modeled. The cost of this significance is loss of precision in model output. Verbal models are also easier to test for sensitivity to parameter-, state- and input values than traditional models. Therefore, a comprehensive understanding of the model’s behavior patterns is more readily obtained. The realm of successful applications of verbal models seems, however, to be restricted to systems with variables which are not physically measurable, but whose values are only available through human intuition. Finally, verbal models may successfully be incorporated in conventional system dynamic models if technically feasible. Such a prosedure would allow for an adequate handling of non-quantifiable data.
The central premise of this study is that complex models of social processes often fail to provide direct and useful evidence for policy makers because, of necessity, complex models are based upon five distinct classes of assumptions. At least two of these five classes of assumptions are based upon a priori or theoretical arguments rather than strict empirical arguments. Because of their inherent speculative nature (at least in part), complex models produce forecasts that are not admissible as evidence in an essentially political debate.
About five years ago a semi-governmental firm, the VAM (Vuil Afovoer Maatschappij) formulated plans to extend their efforts to convert domestic waste to compost to a real recycling industry. The idea was to install equipment to extract secondary paper pulp from domestic waste and sell it to paper and board industry. The Union of Old Paper Merchants opposed strongly: abundancy of low grade secondary paper pulp could ruin the old paper market and times were bad just after the oil crisis. A study was started to investigate possible consequences of the VAM plans. In the four following years a System Dynamics model was built to show the most important mechanisms of the problem.
This paper describes a System Dynamics approach to the problem of linking national and regional transportation to other components of national development plans. A framework of interactions among social, economic, and transportation variables is constructed based on the proposed approach. Such a framework facilitates the analysis of the reciprocal impacts of transportation infrastructure and the socio-economic environment, thus providing an important input to the process of transportation policy making for development. Specific references are made to Venezuela, where a serious effort is being made to explicitly incorporate a transportation strategy into the national development plan.
The model system is an approach to solve the dynamic multilocation warehouse (or plant) sizing problem by integrating different models and methods: (1) A simulation model of System Dynamics type for analyzing effects of different locations and capacities on demand, cost, and operating results; (2) An Integer Programming model for determining warehouse configurations, i.e. effective locations, and capacities. The model system has been applied to an important German wholesale distributor of pharmaceuticals. It has been used for analyzing the firm’s distribution system, and working out proposals in order to improve it.
A study of the multiple-use task produces a method for integrating quantitative and subjective information to enhance decision-making about the multiple use of renewable resources. Methods of resolving conflicts and applying system dynamics methods are given.
Input-output analysis for an “open” system relates production rates for various sectors of an economy to stipulated final demands. However, it is well known that the conventional dynamic analysis usually does not yield results which approach smoothly to those of the static analysis. In this work, the dynamic analysis is cast into the form of a system dynamics model. A modification of the rule which governs sector production rates is introduced so that stable results are obtained which do approach those of the usual static input-output analysis. The system equations are further modified to incorporate time-lagged stock indices and damping in the production rate rule. Prices are handled throughout as in conventional input-output analysis.
In the simulation model the development of the drinking water supply system of South Holland is simulated for the next thirty years given a policy strategy, a certain demand of drinking and subpotable water and some scenario assumptions like discount rate, water quality standards, increase of energy prices. An alternative policy strategy generates an alternative development over time of the supply system.
To introduce system dynamics approach into interprofessional organization to built a model about agricultural market is not so original. That’s more interesting is the use of system dynamic to define what information system must be not only designed but scheduled to regulate the market. Since July 1979, MEDOC gives some useful informations to people who have the difficult challenge to follow the Bordeaux wines market.
This paper contributes to the discussion of academic training requirements for System Dynamics modelers. In particular, it suggest that training in Strategic Management can provide the System Dynamics modeler with some essential complementary tools and a “top management perspective” (or systems viewpoint), which is needed to define problems of real managerial interest. To illustrate these points, the author describes his experiences in defining a problem for system dynamics modeling. The future prospects for the New Zealand Forestry Sector, and the New Zealand Forest Service, are described and the problem for modeling is presented.
In this paper, a pilot system dynamics simulation model, EDFIN1, is used to forecast the impacts of a cost-of-education index (COEI) on patterns of per pupil expenditures across various types of local school districts. Originally designed to compensate more fully those districts that incurred greater costs in the purchasing of educational inputs (i.e., higher teacher salaries or greater need for transportation), COEI adjustments are seen also to have direct impacts on the relative equity of per pupil expenditures across the states as a whole.
The world oil market is undergoing substantial changes, in terms of overall structure, number of key participants, and market adjustment mechanisms. These changes will influence both price determination as well as critical decisions pertaining to the production capacity utilization.
This paper deals with the structure of the system of arms transfers by the United States to the rest of the world. Arms transfers play a significant role in the political, economic, and military affairs of most countries. Because of the diversity of opinion about the necessity for transfers and their true effect, a single policy concerning arms movement has been impossible to devise. This research is the first step in providing a model that can be used to study the effects of transfers and to evaluate policy concerning arms movement.
In large numbers of U.S. urban elementary schools, there is a multiplier effect which operates to reinforce high achievement for initially high-achievers, average achievement for initially average-achievers, and failure for initially low-achievers. This problem is aggravated by the fact that initial levels and perceptions of achievement are systematically related to social class. In part, poor children enter school with less readiness for reading. Evidence also suggests that, actual achievement aside, teachers tend to perceive lower class children as low-achievers simply because they exhibit lower-class family, dress, and behavioral characteristics. In contrast, there are a relatively small number of “lighthouse” schools spread through out the country in which students, often minority and/or poor, achieve far better than home or SES variables would predict.
Any firm or industry which experiences marked cyclical fluctuations in both output and demand can provide a testimony of the damaging effects such oscillations have on profitability. Perhaps none more so than the British Steel Corporation (B.S.C.) whose record in this respect is rather poor. For such industries, therefore, any methods which management science can provide as a means of analysis of the causes and effects of such cycles are to be welcomed. It is suggested in this paper that system dynamics provides an important framework for analyzing the causes of cyclical behaviour in economic systems and that it is this area of application which possesses the greatest chance for successful demonstrations of its use. It is probably for this reason that work using the methods of system dynamics has concentrated, in Gt Britain, on economic systems.
At the beginning of the seventies, grave concern existed over low mobility of researchers due to the stagnation in growth in the research capacity available. Through a strong expansion in research capacity prior to this condition of stagnation, the age of researchers was relatively low. It was feared that the small natural turnover (as a result of a low average age) together with the low mobility would lead to a collective aging of the research corps itself. This aging factor was considered to be a threat to research as a whole since it could lead to mental fixation and loss of creativity. In addition to this, the expectations for making a career and the employment possibilities open to the then recently graduated university students had strongly decreased. This situation resulted in a loss of talent for research groups, and it was feared that there would be a decline in the motivation and development possibilities for researchers. The developments briefly described here formed no phenomena exclusive to the Netherlands but also made their appearances in substantially all of the western countries.
Nonlinear differential equation systems of the kind used in system dynamics are capable of exhibiting highly irregular, erratic, turbulent or “chaotic” behavior. Conditions for the existence of this phenomenon are discussed and their application in dynamic socio-economic modeling explored. In particular, irregularities in economic cycles might be explained by nonlinear feedback effects in contrast to the usual “random shock” model. Dynamo simulations are used to illustrate the basic concepts involved. The view, often emphasized by Forrester, that policy should not be based on level predictions but should focus on regulating qualitative modes would seem to be strongly supported. The positive economics position associated with Friedman that theories should be judged on their predictive performance would now appear to be too restrictive. Instead, the system dynamics view that the plausibility of model assumptions should be the main basis for establishing theory credibility is strongly reinforced.
System Dynamics consists of a body of theory, philosophy, methodology, policy-related applications, and experience. Basic to system dynamics is the theory of the semi-closed, fully closed-loop system in which the feedback loop is the principal construct. In the 20 years of its existence, major emphasis has been placed on the methodology of model-building, on applications, and on philosophical debates involving alternative approaches, particularly the static econometric approach. Experience has produced improvements in the original theory. However, feedback loops are not the only constructs for dynamic theory-building, and cybernetic, self-regulating systems are not the only kinds of living systems, nor is the cybernetic perspective invariably the only or most appropriate perspective over the life history of a particular system. The processes of self-organization and the emergence of new structure deserve equal attention in the evolution of systems. This paper briefly reviews the history of system dynamics. An analysis is then made of present system dynamics theory. This is followed by summaries of three field theories—of critical phenomena, catastrophe theory, and disruptive structures—and attempts at synthesizing these theories and system dynamics. Then ways of enriching existing system dynamics models with fuller use of knowledge from behavioral/social science and sociotechnical systems, with particular relevance to the National Model, are discussed. The paper concludes with an identification of three immediate next steps in research.
There is unquestionable need for sound and disciplined methodology of experimenting with SD models. A number of valuable papers shows various ways utilizing sensitivity analysis, programming of experiments and other approaches. But should we not attack the problem more fundamentally before getting into more specific and costly analysis? We would like propose a different kind of approach, it is analysis of SD models based on experiments with families of trajectories.