Pavel. Luksha. Presentation at the European Association of Evolutionary Political Economists meeting 2004, discussing simulation model of hierarchically organized consumer choice

1. Hierarchy of Needs and Dynamics of Consumer Behavior Pavel O. Luksha Higher School of Economics http://www.geocities.com/pluksha bowin@mail.ru Presentation for the EAEPE 2004 Conference Rethymno, October 28-31, 2004

9. Model design (3) Model variables yield non-linear dynamics based on the matrix of needs (A) K n P n A n D n M n R n B n A S n 1 2 K n+1 P n+1 A n+1 M n+1 R n+1 3 4 F n 5

10. Model design (4) Due to non-linearity, dynamics has been simulated

12. Model runs (sample, case 3)

13. Model runs (sample, case 3)

17. Analysis of disturbances (2) fluctuations, growth of savings; possible new equilibrium unlimited growth of supply Disappearance of a consumer growth and resdistribution of savings growth of savings Disappearance of a good fluctuations ; possible new equilibrium decline in consumption Introduction of new consumer new good is not needed Introduction of new good decline in consumption Decrease in production fluctuations ; possible new equilibrium unlimited growth of supply Increase in production growth of savings Decline in price fluctuations , redistribution of savings decline in consumption Increase in price Prices and volume of production are adjusted (cases 2b & 3) Volume of production is not adjusted (cases 1 & 2a)