A constraint-satisfaction agent-based model for the macroeconomy

We introduce a prototype agent-based model of the macroeconomy, with a budgetary constraint at its core. The model is related to a class of constraint satisfaction problems, which has been thoroughly investigated in computer science. We identify three different regimes of our toy economy upon varying the amount of debt that each agent can accumulate before defaulting. In presence of a very loose constraint on debt, endogenous crises leading to waves of synchronized bankruptcies are present. In the opposite regime of very tight debt constraining, the bankruptcy rate is extremely high and the economy remains structure-less. In an intermediate regime, the economy is stable with very low bankruptcy rate and no aggregate-level crises. This third regime displays a rich phenomenology: the system spontaneously and dynamically self-organizes in a set of cheap and expensive goods (i.e. some kind of "speciation"), with switches triggered by random fluctuations and feedback loops. Our analysis confirms the central role that debt levels play in the stability of the economy.