This paper describes a system dynamics model designed to test policies that could potentially limit, halt, or reverse the growth of human trafficking (and more broadly female exploitation for sex) in Washington, D.C and elsewhere. Human trafficking has been deemed a crime against humanity, yet despite prevention programs around the world the practice has continued to flourish. We believe these policies have had limited impact because of the variety of variables and causal structures that influence the system as a whole. Through the study of the trafficking/exploitation sex market in Washington, D.C., we have identified some key drivers and limiters in the system, as well as some of the complex interactions between them. A computerized version of our model allows policy makers to virtually test how new policies are likely to influence the system before actually implementing them in the real world. System dynamics presents a new tool in the effort to combat human trafficking/exploitation around the world, and our model is the first step towards fully comprehending and eventually eliminating this modern form of slavery.
In this paper, we apply system dynamics to model a queuing system wherein the manager of a service facility adjusts capacity based on his perception of the queue size; while potential and current customers react to the managers decisions. Current customers update their perception based on their own experience and decide whether to remain patronizing the facility, whereas potential customers estimate their expected waiting time through word of mouth and decide whether to join the facility or not. We simulate the model and analyze the evolution of the backlog of work and the available service capacity. Based on this analysis we propose two alternative decision rules to maximize the managers cumulative profits. Then, we illustrate how we have developed an experiment to collect information about the way human subjects taking on the role of a manager in a lab environment face a situation in which they must adjust the capacity of a service facility.
This work evaluates the impact of existing policies in the Brazilian National Plan for Logistics and Transport (PNLT) on CO2 emissions due to the transport of domestic cargo. We build a formal system dynamics model capturing the causal relationships influencing the modal shift from road to cabotage transport of cargo in Brazil. Scenarios are charted to understand the impact of PNLT policies on CO2 emissions(?) and the implications for the transport infrastructure. Our analysis shows that pressure to reduce CO2 emissions plays a critical role accelerating the modal shift from road to cabotage.
The purpose of this paper is to briefly discuss the presence of the archetype Success-to-the-Successful in the energy system and to analyse policy options in the presence of this archetype in the energy system. More precisely, the paper aims at finding conditions under which the path dependent allocation of investments directed to the conventional energy-technology sector can be alleviated, in order to encourage investments in alternative energies and technologies. The discussion draws on a stylized and highly aggregated model of the energy system, which is based on system dynamics. Sensitivity analyses are used as the major diagnostic tool to identify options to break away from the current dominant path of energy production and use, and the investments made in it. The value of this paper lies in the clear articulation of a complex and fuzzy topic, with the help of modelling and simulation. Implications for research comprise a further elaboration of the simulation studies within the energy field.
Obesity results from many influences including genetic and environmental. But eating and physical activity are the two fundamental factors which influence obesity development. This work investigates how food consumption choices and the extent of physical activity have an influence on weight, BMI and the prevalence of obesity in a population of children aged 2-15 years. Around forty years ago, the weight profile of the child (or adult) population was not particularly abnormal. But with increases in energy-dense food consumption and reductions in physical activity, weight, BMI and the prevalence of obesity has increased dramatically, especially since the 1990s. Results from our model can explain these trends. If no interventions are taken to counteract them then these markers will continue to increase in the future with consequent health effects as the children become adults. In an effort to uncover the most effective interventions, this study highlights the role that a system dynamics model can play to help manage the problem in childhood, particularly through considering behavioural changes. In anticipated developments of this research it is suggested that the Theory of Planned Behaviour could be used as a framework to identify the motivational factors that influence children in their eating and physical activity habits.
During a long time, studies on project management were focused on duality between temporary organization (the project) and permanent organization to explain the lack of learning form the project. If the literature review emphasizes learning process and knowledge production during life cycle of project, they both disappear once the project finishes because of a lack of knowledge management capitalization. However we think that the real causes of the success or failure of the projects find their roots elsewhere that in knowledges capitalization. From our point of view, the performance of the project could be explained starting from the concept of the organizational capacity of the project team. The organizational capacity is a collective skill. It authorizes to combine and go into action relevant resources, as teams project attitude (motivation) and teams project aptitude (innovation), organizational competences focused on good relationship at work, coordination, tasks integration, etc . In this way we have developed a dynamic model of projects performance based on organizational capacity. From this model and one of the main question results from this model is: Could organizational capacity improve the project path and behind the success or failure of the project?
The paper investigates the potential of urban transit buses to provide an early market for hydrogen proton exchange membrane fuel cells (PEM FCs) in road transport. System Dynamics has already been used to explore the transition towards the large scale use of hydrogen fuel cells in road transport as a whole. Given the importance of establishing early and niche markets first, on the route to mainstream markets, this paper focuses on one early market in road transport which is considered to be particularly important: urban transit buses. A System Dynamics model has been developed in order to address this particular market in detail. The model is currently still being refined; however results generated so far suggest that the market uptake of PEM FC buses will not be rapid and will require significant public support.
In this brief communication, we argue for more systematic and self-conscious attention, within the field of system dynamics, to the process of knowledge sharing for the purposes of model construction. After explaining our rationale, we provide a number of examples showing how various groups of people---often those with central roles in the problems being modeled---are marginalized, their voices mute or silent. We recognize the valuable work of a number of SD modelers, emphasizing their work in western, often corporate, worlds. However, there are special problems that emerge when important members of the would-be client population are comparatively powerless, under-educated or even illiterate, as is the case in many international natural resource contexts---contexts likely to become more important as attempts to cope with climate change increase. We then provide some practical suggestions for addressing such communication problems. We believe that SD can be of great value in the analysis of natural resource conflicts, climate change mitigation and adaptation, the development of improved management systems, and in policy formulation and evaluation. The anthropological perspective may provide insights that will allow for better integration of the views of marginalized peoples into SD models.
An earlier Conference paper used a small model to illustrate oscillations in local responses to health disparities. It was noted that further work would address medium term trends and thresholds shaping public action to eliminate health disparities. This paper begins to address those issues using Heckathorns model of The Dynamics and Dilemmas of Collective Action. Among many other things the model illustrates the implications of hypotheses related to the relative fitness of voluntary action, norms of reciprocity and selective incentives or sanctions. The hypotheses can be used to explore implications of the governance variable in the causal loop diagram adopted by the WHO Commission on Social Determinants of Health. The conclusion is that the model (a) provides a framework for analysing elite responses evident in decisions made and avoided by governance groups with duties to promote public health, and (b) has the theoretical depth necessary to be recognised as a canonical situation model as defined by David Lane.
The very poor, in drylands of India, survive because of vital ecosystem services from forest commons. Economic and environmental uncertainties and institutional variations governing ecosystems intensify and complicate the linkages between household poverty and dryland forest commons. These economic ties to local ecosystems not only affect the biophysical properties of a forest commons but also how people organize their livelihoods at the household and community level that further influence local ecosystems. We applied system dynamics modeling to examine forest ecosystems and livelihoods in a dryland village in Chittoor district of Andhra Pradesh, India. We do systems dynamic modeling with key stakeholders the villagers, using traditional participatory action research techniques combined with group model building. Simulation results replicate the dynamic behavior of fuelwood availability over time as perceived by the community. It also shows that new institutional arrangements regarding extraction of fuelwood work however only address the symptom and shift the pressure of resource demand to adjacent areas. Participating in National Rural Employment programs helps reduce the dependency on fuelwood for income however the domestic need for energy still drives the extraction of fuelwood. The extended non-simulating model shows the endogenous mechanism of implementation of the new institutional arrangements.
This article describes the results of a research in Information Science field that aimed to verify how System Dynamics could be applied to manage, in a systemic perspective, the information of risk factors in Pension Funds assets and liabilities management (ALM) processes. Delphi technique was used to get data and to identify risk factors with two financial managers and actuaries from 20 Brazilian Pension Funds. By system dynamics, system thinking and agent based modelling techniques it was possible to represent factors cause and effect relations in order to get a function of their expenses and the actual and future payments of the retirements. The conclusions propose a methodology combining these three approaches and show some particularities and benefits of system dynamics to model financial and actuarial assumptions in such organizations and in Information Science research.
Clinical risk management has gained an increasing relevance because of the higher monetary and no monetary effects of clinical errors on healthcare companies performance. For this reason, different risk management techniques from the industrial sector have been adopted by managers of healthcare companies in order to reduce the occurrences of errors and their relative impacts.
Development of software is a dynamic and complex problem. A number of software development methodologies exist to enable software to be produced effectively. Software development methodologies, such as Waterfall and Agile consist of a set of activities that are carried out in the production of software. Activities include Requirement Capture, Design, Development and Testing. Elements of key software development tasks can be automated to improve quality and free up resource capacity. For example, performing software tests can be a laborious activity which if automated can be carried out quickly and repeatedly without error. However, developing automation takes time and is more cost effective for applications with a long shelf life.
This paper presents a study on the penetration of Distributed Generation (DG) under the consideration of a proposal for trading, environmental, and technical incentives, in the Colombian power system. To quantify the technical incentives, we simulated a part of the Colombian grid presents some busbars, low levels of voltage. We connect the busbars "problem", distributed generation and we found an increase in voltage that in a controlled manner can to help to better quality and continuity of electricity supply. Environmental and trade incentives were quantified using international experiences. In addition, we built a system dynamics model to evaluation the complete proposal. We found that the current incentives presented in the Colombian regulation such as tax breaks are insufficient to cover the total costs. Moreover, environmental incentives can be an efficient way to promote renewable energy use in Colombia, in order to achieve, more generating capacity with less pollution indices; and technical incentives in conjunction with environmental incentives can improve further the growth of DG in Colombia. Thus, the DG diffusion become an additional tool for the operator of the interconnected system to make voltage control, improve the quality, and security of electrical power systems.
The emissions of greenhouse gases have become a great worldwide concern due to their effects on climate change. This led to determine, through the Kyoto Protocol, goals to decrease at least 5% of the GHGs by 2012, with respect to the 1990 levels. This agreement established three explicit mechanisms: joint implementation, clean development mechanism and emissions trading. In this context, the European Union created an Emissions Trading Scheme EU ETS (EU Emissions Trading Scheme) that committed 73% of the global carbon market in 2009. Given that the electricity sector is the main contributor of GHGs, it is important to assess the impact of the EU ETS on this sector. This article undertakes this task with the support of a system dynamics model, using the United Kingdom as a case study. Preliminary results indicate that even under a scenario of low prices for emission allowances this would induce significant changes in the installed capacity of the electricity sector, replacing fossil-based technologies by cleaner ones, such as wind and nuclear energy; and also significant reductions of CO2 emissions.
The Portuguese Energy Policy considers the development of a commercially viable and competitive market for energy performance contracting (EPC) as a main mechanism to achieve the objectives of energy efficiency improvement. This paper proposes a study to investigate how to achieve widespread adoption of energy performance contracting by means of system dynamics modelling and simulation. To explore and gather insights on this question, a system dynamics model representing the system of the Portuguese EPC market at industry level will be created. The simulation of that model will provide a helpful basis for analysing and explaining the development of key variables, and accel-erating learning on the managerial, organizational and political adaptation processes that foster the diffusion of EPC adoption. The first phase of this research project aims at identifying and analysing the key factors and critical cause-effect relations that drive the adoption of EPC. With this purpose, a qualitative content analysis on relevant documents was performed and a set of interviews was conducted. That data was ana-lysed to capture the critical variables and its interrelation to formulate a preliminary representation of the system structure as stock and flow diagrams.
Social science theories are developed to understand problematic behavior and describe the social structure believed to be the cause. Only occasionally used, system dynamics has long been considered an ideal testing ground for such theories.
This paper aims to show that incremental stress over environment can lead civilizations to overshoot their resource base as it has been suggested, for instance, by Jared Diamond. Despite this author has recently been criticized by scholars of different orientations, we think this criticism has likely been exaggerated. Diamond`s answers to the critics are not always entirely
The paper will review representations of regional development models in terms of their assumptions (peeled away like an onion) and in terms of their level of complexity, very much in the tradition of Peter Allen's classification system. Some applied models of regional economic development in Asia will be presented in more detail and compared to each other in terms of their ability to understand development and to gain knowledge about real world problem solutions. Understanding reality and gaining knowledge about a problem require us to reduce the real complexity of any particular situation to a simpler, more understandable system by making specific simplifying assumptions. It is shown that there exist representations that, while being sufficiently simple to be understood, remain sufficiently representative of reality and yield significant power to make a big difference to regional economic development in Asia when compared to other, less useful representations. For instance, what is important to be explained in dynamic socio-economic systems is the structural change in terms of degree of heterogeneity of agent populations in space, the modularity and hierarchy of a system, and similar aspects of composite structural existence.
The events in the energy sector which are evolving globally put more and more emphasis on renewables, through the use of which it is possible to reduce not only impacts on climate change but also to place a more gradually decline of expendable fossil fuels. Countries more and more are placing importance on development strategies and applying the principles of greening the environment.
To ensure implementation of requirements of EU Directive 2006/32/EC on energy end-use efficiency and energy services in Latvia First National Energy Efficiency Action Plan (EEAP) 2008 2010 is approved where the goal is established to reduce energy consumption by 3483 GWh by 2016. The greatest energy savings 77% or 2701 GWh are planned in the residential sector as it is the major energy end user in the country. The largest part of it is multifamily buildings with every flat owned by individual owner.
This paper builds on previous research in stock-flow experiments. 168 participants were asked to recommend a hiring percentage of female professors they thought necessary to reach gender balance in an unbalanced personnel situation. They were also asked to estimate the timeframe needed to reach this. Additionally, participants were asked to write down a justification for their choices. These justifications provide insight into the reasoning people use in stock-flow tasks. The experiment confirmed that people have difficulties understanding the distinction between stock and flows, and in particular underestimate the effect of average delays. Moreover it showed that not only cognitive bias, but also political considerations play a role in reasoning on this task. Further research is needed to examine the interplay between these two.
In this paper, I present a model of the articulations between the formal and informal mechanisms of housing production with the objective to analyze the causes of the rise and persistence of informal settlements in the developing world. The model is based on System Dynamics, a method of simulation that deals with complex systems characterized by dynamic behavior, and is tested using the case of Bogotá, Colombia, a city known by the prevalence of informal housing markets and its rich experience in the implementation of public policies to address informality. The final results and policy experiments show that informality arises from the inadequacy of a system of infrastructure financing based on tariffs and cross-subsidization and from the unintended consequences of classic interventions to deal with this problem such as settlement up-grading and the provision of public housing. A preventive policy based on dismantling these interventions and increasing the supply of land with urban services through a change in the system of infrastructure funding shifting the source of financing from cross-subsidies to property taxation is proven to be a more cost-effective method to mitigate the negative consequences of informality.
Political dynamics often arise from within a political system, but can also be affected by outside forces. In order to understand the potential effects of these forces, we created a model to simulate political dynamics in a society under different internal and external conditions. The system dynamics model uses a cognitive modeling framework to determine human behavior. We present the results of the model under four different scenarios, including a base case, a case where an outside government provides support for the opposition, an information operations case, and a show of force case. The model shows that there is potential for these different conditions to have significant effects, including higher-order effects that may be unanticipated if a systems perspective is not taken.
Human and social models are an important capability of system dynamics, and sensitivity analysis can be used to strengthen and better understand these models. To learn about which sensitivity analysis techniques are most suitable for models of human behavior, different promising methods were applied to an example system dynamics model, tested, and compared. The example model simulates cognitive, behavioral, and social processes and interactions, and involves substantial nonlinearity, uncertainty, and variability. Results showed that some sensitivity analysis methods create similar results, and can thus be considered redundant. However, other methods, such as global methods that consider interactions between inputs, can generate insight not gained from traditional methods.
Critical decisions need to be made to face global crises. Modeling and simulation can help to make these decisions effective and shared. Ethical issues are involved in this process and should be included for better quality decisions. Looking at the past helps us to cast light on how ethical choices can be important in resolving critical situations. The ancient Greek city-states of Athens and Sparta show opposed paradigms in policies and life-style, but only one proves itself stable and lasting. Surprisingly, its not the city-state we all would had lived in. Human activities in both city-states cause, in time, internal instabilities. Crises that will be solved through expansionist policies, migrations and colonies settlement. Athens faced seven migrations in less than five centuries. Instead, Sparta, after its first (and only) dramatic migration event, introduced corrective actions to contrast instabilities. The change is ascribed to the mythical lawgiver Lycurgus, but it could likely be the consequence of a shared vision. A simulation model fitting the two city-states behavior has been developed and its structure comprises seven interconnected sectors. The paper includes model description and its interpretation, a brief overview on ethics in modeling, and a note on our project ethics in the evolution of societies.
The water management system for the Washington Metropolitan Area (WMA), like many other public utilities, is reaching its maximum service potential in the face of this rapid growth and climate change. Frequent droughts have not only prompted pricy withdrawals from reserve water supplies more than once, fall of 2010 being the latest case of such water releases, but also have generated varied responses from different local governments that make up the WMA, reflecting lack of cooperation. This also reflects that WMA water supply system is not adequate enough to meet daily demand using only Potomac, Patuxent and Occoquan resources. Prior information about time and volume of releases will not only help in the efficient allocation of water but it will also help in well-informed decision making. Therefore, this paper does the following: 1) Model the demand and supply dynamics for the WMA; 2) Analyze the impact of historical droughts on water availability; and 3) Assesses the performance of the system under various demand scenarios and drought conditions. Finally, the paper concludes that WMA water supply system is susceptible to shortages in future and performance of the system is expected to deteriorate in the coming years with recurrence of historical droughts.
Las Vegas is faced with three important challenges: promoting sustainability, quality of life and resilience. Sustainability is the ability of Las Vegas residents to meet current needs without compromising the ability of future residents to do the same. Quality of life (QOL) is the level of satisfaction of those residents needs and personal preferences. Resilience is a measure of how the city responds to disturbance. A strong city needs a high degree of all three.
The impossibility to identify and represent events and emergent characteristics of the system analyzed with computer simulation models aimed at projecting future events has posed serious questions about their validity in the field of social science. While methodological issues, both concerning the foundations of the methodology and the formulation of models, are identified, the System Dynamics methodology seems to allow modelers to gain a deep understanding of the systems studied while answering the four dilemmas identified in this study. These models allow for the structural representation of the system through the identification of causal relations underlying its main functioning mechanisms, represent both dynamic and detailed complexity using wide social, economic and environmental boundaries. Dynamic simulation models are by no means perfect and will never be; nevertheless, modelers have the responsibility to use our best scientific understanding to develop reasonable and sustainable policies. T21 and PCM, integrated national development models, allow us to do so by enhancing the understanding of systems.
The US Government faces some of the biggest strategic challenges with very high stakes. When should we use military power and how do we use it to improve stability rather than worsen it? How should we manage a huge but limited budget to achieve a wide range of big, unstructured, and evolving strategic objectives? Can we help struggling regions develop and if so how? These questions involve highly complex systems with many dynamics over time. They have the further challenges of a lot of uncertainties, limited data, wide boundaries, many stakeholders, and the need for rapid decision-making. In an environment fraught with politics and skeptics, how can we use analysis to improve the rigor of decision-making on such big and important questions? The authors will use examples from the last 8 years of policy and decision analysis work to illustrate lessons both positive and painful for successful use in government and business, speaking from the perspectives of both modeler and decision-maker, inside and outside the government.
Understanding population dynamics is crucial to understanding current and future health care needs and designing systems to meet those needs. In this paper, we provide a methodological approach to answering questions of population dynamics in a system dynamics model configurable to initialise in dynamic equilibrium or disequilibrium. Some questions include: how does current measured population compare to a population of the same size in equilibrium, and how would a change from current observed birth rate to equilibrium birth rate affect population levels and the dependency ratio over time? To illustrate the methodology, we apply our approach to Singapore, which is experiencing an increasing proportion of the elderly population.
The recent attempted or actual overthrow of long incumbent governments in Egypt, Iran, Libya, Algeria, and Tunisia, the continuing engagement of Western powers in a number of counterinsurgencies, and a rise in global religious, nationalist, narco- and cyber-terrorism have highlighted the continuing importance of modeling conflict, defense, and security issues. System Dynamics, because of its ability to integrate political, organizational, and material factors, is ideally suited as a vehicle to investigate these great problems. This potential, however, contrasts greatly with the relative sparseness of academic publications in this area.
The system dynamics contribution to project management research is one of the jewels of the crown with respect to our field. One of its key contributions is to understand how iteration of tasks in the form of project rework influences key outcomes measurable such as cost and timing. We build upon this tradition in a conceptual paper that suggest that other types of iteration, which are mindful and beneficial, need to be considered. When considered, two particular concerns fall out with respect to innovation projects that need further exploration by system dynamicists. One is that some projects, particularly innovation projects, may need to change scope mid-way through the project if they are to be successful, and there is no way to anticipate this ex ante. The other is that innovation projects tend to iterate in scope from project to project and that this iteration is necessary because of the escalation of market expectations. We explore the implications of these ideas and how they should impact the course of future system dynamics research.
This poster session will describe the progress of a pilot project initiated by Professor Jay Forrester through the Creative Learning Exchange. The project goal is to create online curriculum materials for K-12 students and interested adults that will illustrate the characteristics of complex systems:
This article explores the methodological issues in mixed use of Grounded Theory and System Dynamics approaches in a research project. We discuss how analysts dealing with qualitative secondary data in the conduct of System Dynamics Modeling work through the questions of the role of existing literature and generic structures in system dynamics, directions of research (inductive, deductive, or abductive), the mixed methods ability to extract system dynamics modeling information, and potential outputs of such research. These discussions are based on an analysis from an empirical research project. The article describes a research design and suggests next steps to develop a coherent analytical technique for researchers.
Since 2005, there has been an opportunity for joint reflection about the quality of the peer review process at each conference. In the subsequent conferences, discussion became more structured and this year, a substantial effort has been made. Still there remains work to be done in order to arrive at a policy that would achieve a satisfactory balance between paper and presentation quality on one side and other goals of the conference on the other. This years meeting is the opportunity to review what has happened since last year's meeting and its recommendations, also we can assess up to which point the new policies have yielded improvements. Reviewers, chairs and organizers are especially invited to give their input.
The Latinamerican Chapter has the mission to help the SD-community grow in the Spanish speaking countries. Founded in 2003, it has Latinamerican members from Mexico to Chile, from Spain and a growing number of Spanish speakers living in other countries. Since 2003, the annual meeting allows practitioners to gather and newcomers to get in to touch; we have been in Mexico, Chile, Colombia and Argentina so far. These conferences are the base of our positive feedback loop: each year the number of works submitted and presented is increased. Since 2005, the Spanish Revista de Dinámica de Sistemas publishes two numbers per year. The sisTEMAS newsletter and a mail list allow keeping in touch. In November 2009, the 7th Latinamerican Conference took place in Santa Marta, Colombia, organized by Industrial University of Santander, National University of Colombia and University of Magdalena. This year's meeting will take place in Lima, Perú in November 2010. It is an opportunity to welcome new members. If you would like to join us please contact Gloria Pérez ( gloria.perez@itesm.mx), Isaac Dyner ( idyner@unalmed.edu.co) or Martin Schaffernicht ( martin@utalca.cl). The annual business meeting was held in Seoul and affords the opportunity to get involve with the Latin-American Chapter activities and develop the networking we need to develop the System Dynamics field in our countries.
The SDS Education SIG continues to pursue its twin interests in publicising and enhancing both the contribution of SD to Education Management and the evolution of the contribution of SD to the curriculum - in both cases the interest spans the whole span of education from K-12 to Higher Education. This years roundtable/annual business meeting is the place to come to discuss substantive education issues, whether you are part of the Education SIG or simply exploring possibilities. The Ed SIG is establishing an agenda which embraces both elementary and secondary education and high education. We also deal with both management and public policy issues. We will continue working on the intellectual and operational challenges to system dynamics of the PK-20+ concept of lifelong learning from prekindergarten to continuing adult education, reaching beyond the usual silos separating the domains. Come tell us what you are working on, or just ask questions.
There exist many examples of organizations which failed to react to environmental change. Polaroid and Digital Equipment Corporation (DEC) are just two of them. While existing literature in particular focuses on organizational inertia and routines as impediments to change, attention to stakeholders has not received much consideration outside the area of business ethics. Since attention proved an influencing factor at Polaroid, DEC, and in a change process of the New York Stock Exchange, the interrelationships between inertia, attention, and change will be analyzed in the present paper. Stakeholder attention proved to be influenced by stakeholder pressures as well as an influencing factor on the perception of stakeholder pressures. Additionally, sensitivity analyzes revealed how different policies for managerial intervention work by themselves and in interaction.
The current turmoil in the financial markets forces us to question the validity and relevance of the present economic theories. Complex dynamics characterized by bounded rationality and strong impact of expectations on the markets provides an independent source of fundamental uncertainty and this one can lead to speculative bubbles in assets markets triggering growth of public debt. The neoclassical methodology based on logical empiricism and deductive reasoning has failed to show what is going on in the real world. We will employ the institutionalist's view and focus on the behavioral aspects of the system modeling decision making process. We illustrate this approach with a model drawn from the current Greek sovereign debt crisis and its bailout discussions. The main benefit expected is the increased realism of the model itself. The discrepancies between theoretical predictions and observed behavior have had a major negative impact on economic models and system dynamicists can contribute a significant amount of value to institutional economics.
We offer a theory of competitive process improvement to explain the process of how best business practices emerge through dynamic interactions between competing processes. Grounded on the history of the interaction between two distinctive competing processes, Mass Production System vs. Toyota Production System, we employ the lens of competitive dynamics to develop a formal model. Three insights emerged: for sustainable competitive advantage, (1) a firm needs to invest in explorative activities at an early and continuous fashion; (2) external competitive tension plays a vital role in managing internal tension of organizational learning; (3) a firm may commit perception biases when interpreting others learning (re)actions.
Identifying the effects of change in construction has been a topic of discussion and debate for several years, especially those changes that delay contractors and disrupt productivity.
In recent years, Taiwan government has offered incentives and supportive policies such as tax reduction with a hope to foster the development of domestic online game industry. However, domestically developed online games are failed to dominate the online game market. Over seventy percents of the market share is occupied by foreign games, especially those from Korea. In this paper, a system dynamics model is built to explore the growth and competition dynamics of the online game market. The model shows that multiple reinforcing feedback loops and limited market size together led to the rapid but temporal market growth. The market reached its limit so quickly that Taiwans domestic game developers lost the opportunity to grow because of unavoidable time delays in R&D capacity expansion and game development and commercialization process. The online game case shows that market growth and R&D expansion that contrast sharply in lead times could cause tough barriers that are far beyond late entrants abilities to conquer, even governmental support might hardly be useful.
Feedback dynamic complexity is an important feature of complex systems. Professor Jia Renan and his SD group began their study of the theory and application of SD feedback dynamic complexity analysis method since 1985, and proposed a series of approaches successively, which have constructed an approach system of SD feedback dynamic complexity analysis of complex systems. Four major functions of SD feedback dynamic complexity analysis were extracted in this paper, which are formulating feedback model for the system problem; constructing feedback model for Successful case; simulation; feedback loops calculation and management policy analysis. Many questions and further study on each of the four functions were respectively proposed. The paper is also a SD research summary of the group for nearly three decades. We believe that there will be many benefits for the system dynamics community in developing the method system of SD feedback dynamic complexity analysis.
This paper contrasts the tradeoffs of modeling the same dynamic problem at a micro scale and at a macro scale of analysis: discrete system simulation (DS) versus continuous system simulation or system dynamics (SD). Both are employed to model the influence of entertainment education on terrorist system decay, with implications for field application. Each method optimizes different design, scope/scale, data availability/accuracy, parameter settings, and system sensitivities. Whether the research served by the computer model is applied or theoretical, DS tends to be useful for understand low-level individual unit/step influences on system change over time, whereas SD tends to shine when a wide-angle focus upon sociological/aggregate change is required.
In this paper we reflect on effective research strategies for building helpful system dynamics models on induced technology change that are substantiated in the relevant literature and empirical data sources. The paper positions the innovation system literature within the overall field of induced technology change as a distinct systemic approach that offer relevant conceptual starting points for a system dynamics modeling experiment on induced technology change analyses. Innovation system research is interested in identifying the processes underlying innovation, industrial transformation and economic growth. Also, the interest in the functional dynamics of innovation systems creates an opportunity for system dynamics researchers that are applying a scholarly developed modeling approach aiming to identify the structure and processes that explain behavior patterns of induced technology change.
We provide a system dynamics implementation of an important ecological economics model. Such models are typically constrained to use functions chosen conveniently to allow for analytic solution, such as the Cobb-Douglas function. This function however has the undesirable attribute that the elasticity of substitution is one. Fixed elasticity does not allow for the substitutability between man-made capital and natural capital to change, which is vital for economic sustainability.
This paper studies the effect of R&D consortia policy and the consequences of the policy implementation process on technology spillover through Foreign Direct Investment (FDI) in Thailand using a system dynamics method. The results show that the R&D consortia policy increases the level of technology spillover and improves the economy of Thailand by boosting the productivity and GDP per capita of Thailand. The R&D consortia policy also amplifies the level of FDI which adds up to the productivity growth. When considering the policy implementation process, shortening the implementation time significantly increases the benefits in the short run but in the long run the additional benefits from shortening the implementation duration diminished. The FDI signaling effect reduces the benefits of the policy. However, when accounting for the signaling effect, Thailand is still better off if the R&D consortia policy is implemented.
Most business organisations attach great importance on intellectual property and knowledge today, because the property and knowledge are considered as source of competitiveness. In order to protect them, businesses have tried to control the source of intellectual property and knowledge, to say engineers and knowledge workers. This has been working well to enable the businesses to be competitive especially in manufacturing companies and IT companies in early days. The environment around businesses especially in information communication technology and service industries is now changed. Since needs of customers, government regulations and market environments are changing rapidly, knowledge and skills of engineers and knowledge workers need to be quickly updated. Falling behind competitors can lead to withdraw from the market. Nevertheless, businesses seem to continue their protective control on their personnel in old style. This can eventually cause not only lowering workers condition but also aggravated result of businesses because of obsoleteness of knowledge and loss of competitiveness. In order to examine this possibility, this paper shows simulation model based on existing research concerning employment and knowledge management. The result of simulation suggests overprotective policy would reduce businesses competitiveness and protecting knowledge workers job choice supports their companies development.
According to the Global Terrorism Database, Asia was the continent that suffers the highest number of terrorist attacks and the highest number of casualties during the period 1998-2007. One of the numerous terrorist organizations operating on its territory is Lashkar e Taiba (LeT) that was created in 1999. From its inception to 2007, it has staged ninety attacks generating 1,945 casualties. This paper presents a system dynamics model to try to reproduce the number of monthly incidents of that organization. The construction is carried out adapting to the organization those feedback processes that explain the survival over time of a terrorist organization. Comparing the data series and the data obtained by simulation, the paper examines the degree in which the model reproduces the incidents of the organization. After checking the usefulness of the model, different counter terrorist measures are tested in order to assess their effectiveness.
Evidence shows that the paths of growth followed by different countries are diverse. While some countries present a fast growth, other countries show a moderate or even, a slight growth. The first behavior could be justified by means of positive feedback loops that provoke strong accumulations while the second one could be explained through interrelationships of positive and negative feedback loops. To generate process of growth, this paper constructs a system dynamics model considering a causal structure that gathers decisions of consumers, firms and a government in an economy. A simulation exercise obtains different paths of growth taking into account both different governmental strategies and boom and bust cycles. Due to the possibilities that the model offers different political aspects tied to governmental strategies, such as distribution of wealth, degree of corruption or level of education, are examined.
Construction branch forecasting model allows estimate the industry development problems. The main attention is turned to the living area construction. The model consists of several sub-models: amount of apartments, real estate prices, needs for apartments and living area forecasting models. The apartments amount forecasting model bases on principle if there is insufficient number of apartments in the economic system, then, first of all, apartments with small areas are financed and constructed, i.e., multistory buildings with one-room apartments. The increase of apartments amount depends on the financing that is intended for construction, as well as from the average apartment area and construction costs per square meter, in other words, from funding and construction costs. The real estate prices influential parameters are the increase or decrease of the housing fund, the total apartment market influence on separate segments in apartment market (and vice versa). The apartments needs influential factors there are an increase of apartments amount; depreciation of apartments (reduction of amount); improvement of living conditions. In paper shown, that in Latvia the balanced amount of apartment construction is approximately 1800 apartments per the year, but considering the fluctuations of surplus and needs, it can temporarily fluctuate from 1434 to 2019.
We developed a feedback model for the control of the angular position of a model helicopter that has a single main rotor and single tail rotor. Basically, there are two mechanisms involved in the control of angular position in the horizontal plane; the torque resulting from the rotation of the main rotor and the opposite direction torque created by the tail rotor. For the purpose of this study, the rotational speed of the main rotor is kept constant. The angular position is solely controlled through the change in the tail rotors rotational speed. Tail rotors rotational speed determines the net torque on the fuselage; the net torque determines the angular acceleration; the angular acceleration changes the angular velocity; the angular velocity changes the angular position. Therefore, the angular position of the fuselage is indirectly controlled by the tail rotors rotational speed. The delay introduced by the indirect control process makes it difficult to control the angular position of the model helicopter. After modeling the physical structure of the model helicopter, we simulated it with two different decision making heuristics. The Modified-VSL heuristic that is introduced in this paper performs much better than the simple naive heuristic.
Efforts to increase forest cover in the developing world will only succeed if the root causes of deforestation are addressed. Researchers designing reforestation initiatives tend to emphasize macro-level drivers of deforestation, such as population growth and federal policy. On the other hand, local people have knowledge of social and cultural dynamics that may be critical in the successful implementation of reforestation efforts. The perception gap between researchers and community members has led to many failed or insufficiently implemented projects. An emerging toolgroup model building with system dynamicsshows promise in its ability to integrate different perspectives on a complex problem such as forest cover loss. In this study, I use system dynamics modeling methodology to compare causal loop diagrams of forest cover dynamics on Negros Island, Philippines generated by researchers working for the World Wildlife Fund with causal loop diagrams generated by community members in upland Negros. The diagrams were significantly different, with very few variables in common, but both illuminate critical aspects of the deforestation problem on the island. I conclude that reforestation initiatives in the Philippines would benefit from incorporating all relevant information into a single, coherent model.
The comparison of mental models of dynamical systems can help understanding they way individuals understand dynamic situations and how their understanding changes. Current approaches like the Distance Ratio and the Closeness Ratio have been criticized for not taking into account feedback loops and delays; an improved comparison method has been proposed, specifying an Element Distance Ratio, Loop Distance Ratios and a Model Distance Ratio. We are advancing in the automation of the computations in order to take this burden away from analysts. This paper describes the essential computations. It briefly presents the comparison method for the different ratios. Then it introduces the conceptual architecture of the software tool, its main data structures and algorithms. The tool shall be put to use in mental model research.
System dynamics is progressively taught in different levels of education systems. There are challenges as for integrating it into the curricula of different professions and at the same time striving to grow it into a profession on its own. This paper starts recognizing that no representation of what is learned in system dynamics has been published in a way compatible with mainstream curricular tools. Specifically the need to integrate system dynamics into a competency-based curriculum has lead to a search in the field. We have opted for Blooms taxonomy as a widely shared reference frame and thus have expressed cognitive resources and development indicators in Blooms terms. The result is now a valuable resource for incorporating elements of system dynamics across different courses of undergraduate programmes in our university. Even so, the result has to be critically revised, for there are several open questions concerning the development stages of the learning process and the best form of representing them in order to facilitate the design and development of learning and assessment activities.
EP industry is expected to play a central role in climate change mitigation in many countries. With its rich clean energy potential, Turkey is a particular example. Being a developing economy, Turkey contributes to about one percent of global GHG emissions, and its per capita emissions are equal to and now exceeding the world average. The EP industry in Turkey is responsible for 28 percent of the national CO2 emissions. If a viable and sustainable global climate treaty develops in the near future, as a party to the UNFCCC, Turkey will have to assume national abatement targets and face the challenge of shifting its heavily fossil fuel based EP production towards renewable energy sources (RES), decentralized generation (DG) and increasing efficiency gains. In this paper, we create a dynamic simulation model of EP industry in Turkey so as to analyze the options for CO2 mitigation through replacements with cleaner energy resources. The model focuses on the supply side of EP sector and represents the investment, production, pricing and financing structures of coal, gas, hydro, wind and solar power plants as well as the existing natural potential for the renewable resources.
Outlined is the systems based process used to investigate delayed discharging, which combines parts of the Soft Systems Methodology (SSM) with Systems Dynamics (SD).At the early stages use of hard system approaches were inappropriate to investigate this type of complex problem. SSM was used to consider the soft problems present, expressing the problem situation as a rich picture. This informed construction of a SD model to investigate policy interventions for reducing delayed discharges. This process had practical implications for structuring qualitative data to inform the SD methodology.
Delayed discharges have become a common problem within hospital, predominately within elderly care. Patients become blocked unnecessarily along the patient pathway. Historically allocation system policies were needed acting as coping mechanisms when there was a lack of social workers to carry out patient assessments and set up services. These allocation policies helped to reduce delayed discharging of elderly patients when resources were scarce.
For many decades, Korean shipbuilders have been the leader of the global market. They offer cost effective and high quality vessels based on their advanced production technologies, good management and process control which helps them utilize their economies of scale and learning effect. Korean shipbuilders top the industry with highest market share.
This paper re-defines three hypothetical laws of capital accumulation including endogenous rate of accumulation and capital-output ratio as state variables. An original non-linear relationship relates their growth rates. Other state variables are output per worker, employment ratio and relative labour compensation. A comprehensive Phillips equation, governing real labour compensation, is an element of the initial law (HL-1). HL-2 substitutes the former equation by a new one that reflects a long-term tendency of relative labour compensation to fall.
With the advent of Enterprise Resource Planning (ERP) systems, availability of data is no longer the bottleneck to decision making in many organizations. Instead the reverse seems to apply more frequently. Integrated organization-wide computer systems overwhelm managers with data to such an extent that it becomes difficult to assess relevance for managing operations. A number of methodologies attempt to help management to distill meaning from large amounts of data. These methodologies enable managers to identify multiple performance indicators and determine tradeoffs between effects of proposed improvements. Implementation of improvements however entails organizational change. Methodologies are commonly used in an expert mode, which makes them prone to many of the potential traps of change management, such as lack of commitment due to the not invented here syndrome. Alternative methodologies such as group model building enable problem owners to identify problems and combine knowledge and system data in solving these are available. In this paper we explore three group model building projects in an ERP context. We address the context in which the projects were carried out and the process of client participation and model construction. We describe effects in terms of end products, quality of solutions and outcomes of system changes.
Society is dependent upon electricity. In the last decade international scale outages have occurred with unfortunate regularity. While the impact of these outages has been limited to a few hours or days, they have been expensive and prompted fears that more severe failures could occur. While crises are perceived as events, their true origins come from the pre-crisis and post-crisis phases, where preparations and learning set the stage for the successful management of unusual events. A power crisis of a few weeks duration can set the policy agenda for many years. In this paper we describe a crisis model that captures the dynamic state of a power grid, the effects of failure on clients, government, and the public. The model was developed in concert with and validated by a panel of crisis managers. These factors combine to determine the post-crisis policies and socio-political factors that influence policy over much longer timeframes.
System Dynamics (SD) main aim is to study dynamic behavior of systems based on causal relations. The other purpose of the science is to design policies, both in initial values and causal relation, to change system behavior as we desire. Especially we are interested in making systems behavior a convergent one. Although now SD is mainly used in situations of single policy maker, there are major parts of situations in which there are multi policy makers playing role. Game Theory (GT) is an appropriate tool for studying such cases.GT is the theory of studying multi decision-maker conditions. In this paper we will introduce GT and explain how to apply it in SD. Also we will provide some examples of microeconomic systems and show how to use GT for studying and simulating dynamics of these example systems. We will also have a short discuss on how SD can help GT studies.
Vulnerability black markets (VBMs) are sites for trading malicious tools targeting software vulnerabilities. VBMs enable different actors to access malware and use them to attack vulnerable computers. This article presents an economic rationale for the existence and continuity of VBMs. It is assumed that buyers and sellers decision to trade in the black markets depend upon their perceived costs and benefits. As long as the expected utilities of engaging in the black markets are higher than the costs, buyers and sellers will continuously trade in VBMs. A system dynamics (SD) model is developed to capture such problem. Concepts from market-for-crimes theories are adopted into the model, since they provide a useful perspective for explaining criminal behavior such as in VBM.
The fundamental objective of this paper is to present a dynamic framework to test the two competing theories; the Pecking Order Theory (POT) and the Trade-off Theory (TOT); that explain the capital structure behavior of firms. For this purpose we use System Dynamics (SD) method to develop a generic simulation model of a manufacturing firm based on generally accepted accounting principles. We model the capital structure decision conforming to POT and TOT to test the two competing theories, in isolation and in combination. The firms may pursue POT or TOT for their capital structure decision, but it is generally agreed that while doing so their prime objective is to maximize the firm value. Hence we presume that the managers stick to the core objective of firm value maximization.
Water Resource Carrying Capacity (WRCC) is an important metric for regional water management in China. Shandong Province of China faces a serious water shortage if WRCC is not managed at a sustainable level. This study focuses on applying system dynamics methodology to evaluate different development scenarios and their associated WRCC for Shandong. System characteristics of local water resources and demand in Shandong are captured and modeled using system dynamics within VENSIM software. The dynamic model of Shandongs WRCC consists of 5 subsystems: agricultural development, population growth, industry and tertiary industry, water resources, and water pollution. Historical data are used to calibrate model parameters. Impact on the WRCC is assessed through three growth scenarios: modest industrial growth, aggressive industrial growth, growth combined with wastewater recycles. Based on simulation results, WRCC that most likely can sustain economic growth without overstressing the water supply is one with modest growth combined with wastewater recycle.
Possible short, medium and/or long term scarcity of minerals/metals may actually pose a threat to modern societies. Its potentially disruptive societal consequences qualify this issue for exploration from a world/regional security point of view. Hence, the forces of System Dynamics modelling and simulation and Exploratory Modelling and Analysis are joined in this paper to explore the dynamic complexity of potential mineral/metal scarcity under deep uncertainty and to create useful scenarios for inter/national risk assessment.
In this paper, an Exploratory System Dynamics model of a concerted run is first of all presented. The immediate cause for modelling a concerted bank run was the mediatised call for a run on the DSB bank. This Exploratory System Dynamics model was developed the morning of the call for the bank run, before the start of the ensuing bank crisis, in order to quickly foster understanding of possible dynamic behaviours of concerted bank runs and to perform rough-cut policy/strategy analyses. The model is subsequently used to illustrate the
This follow-up paper presents several new 'hot' cases for teaching and testing System Dynamics. The cases were developed between April 2009 and January 2010 for the Introductory System Dynamics course at Delft University of Technology in the Netherlands. These cases can be used for teaching and testing introductory and intermediate System Dynamics courses at university level as well as for self study.
The main goals of this paper are to explain and illustrate Exploratory System Dynamics and Exploratory System Dynamics Modelling and Analysis, which are both useful for exploration of, and decision-making in, dynamically complex issues that are deeply uncertain. First, the need for exploratory approaches is discussed. Second, different exploratory approaches are briefly introduced. Third, a typology of safety and security issues/crises in terms of degrees of complexity, uncertainty and urgency is proposed. Different types of inter/national safety and security issues for which exploratory analyses may be useful are listed too. And the application of these exploratory approaches is subsequently illustrated on some of these issues, more precisely on (i) an acute financial crisis (the concerted bank run on the DSB Bank), (ii) an imminent pandemic flu crisis, and (iii) plausible mineral/metal scarcity crises. The paper ends with some conclusions, lessons learned, and a discussion of future work.
This paper presents a small exploratory System Dynamics model related to the dynamics of the 2009 flu pandemic, also known as the Mexican flu, swine flu, or A(H1N1)v. The model was developed in May 2009 in order to quickly foster understanding about the possible dynamics of this new flu variant and to perform rough-cut policy explorations. Later, the model was also used to further develop and illustrate the use of Exploratory System Dynamics models as scenario generators for Exploratory Modelling and Analysis.
Stocks and flows are basis of dynamics. Understanding of stock and flow is crucial in comprehending and managing problems such as global warming and national debt. Yet previous experimental studies have found that people perform poorly in simple stock-flow tasks. However, many do have a notion of accumulation in terms of calculating running total, adding or subtracting items to keep track of a running tally. Here a pre-test-treatment-post-test experiment was designed to test the hypothesis that peoples understanding of stock and flow behaviours will improve after being asked to reflect on a cognitive conflict, generated by utilizing their running total calculation. Comparisons with a conventional approach to teach stock and flow dynamics and without teaching were also done. Results show that improvements were not significant; the hypothesis lacks support. On the other hand, the conventional approach produced significant improvement. Possible explanations of the results and their implications for education on dynamics, communication of complex dynamic problems and policy insights are discussed.
The insecurity crisis that Mexico is facing has taken to a reform in the Federal Law to impel the development of a new federal police, with trained elements in knowledge and tactics that allow them to face the crime of one more effective and coordinated way. The present work shows the results of a project designed to evaluate how feasible would be the implementation of such law. It required integrating a team with officers of the Federal Police force to design a dynamic model to analyze the key processes related to the transition of the current force to a new structure required for the law. This document presents the methodological frame, the design of the model some findings about the process and a scenario analysis to visualize some strategies that could be implemented in order fulfill the requirements of the law.