Brett Parris

Over the past decade, humanitarian events affected on average 120 million people annually. Whilst many of these events are human-induced, a large number of the 400 or so complex humanitarian emergencies that require international response each year are natural. Such events result in loss of life, injure and maim survivors, destroy infrastructure and give rise to psycho-social trauma. Aid agencies working alongside affected communities must address all these consequences as part of their responses. What is also required though is an appreciation that worldviews will inform how affected communities both understand the cause of the event, their role in the event and how they will subsequently participate in rebuilding or reconstruction programs. Disasters can be affected by religious beliefs. With more than 85% of the global population self-professing religious belief, these worldviews are often shaped in whole or in part by sacred texts, religious teachings and sectarian practices. In this regard, it is not uncommon for those affected by disasters (particularly natural disasters) to genuinely describe these events as ‘acts of God’. Effective responses require the local context to be central in assessing needs and determining capacities. This must include an understanding of and authentic engagement with religious beliefs and how this may affect how the humanitarian event interacts with these beliefs. There is though little evidence as to how professional humanitarian workers accommodate the religious beliefs of local populations in their planning, implementation and evaluation of humanitarian responses. This paper draws on the experiences of humanitarian workers based in the USA and Australia from both faith-based and secular international non-governmental organizations to consider both how these workers themselves accommodate the religious views of affected communities in their responses and also their experience as to how such views affect the effectiveness of responses. This paper will consider why aid agencies must incorporate (and appreciate) different worldviews around disasters in order to more effectively respond to the needs of communities affected by humanitarian events. It will also identify difficulties and opportunities experienced by individual humanitarian practitioners as well as agencies when working in such environments.

Trust is a dynamic and complex phenomenon and understanding the factors which affect its formation, evolution and disappearance is a critical research issue. It has been shown that trust plays a key role in how human and social capital develop, how economies grow and how societies progress. In this paper, we present an agent-based model of the relations between a dynamic effort allocation system, an evolving trust framework and a reputation module to study how changes in micro-level rent-seeking traits and decisions can shape the emergence of trust across the simulated environment. According to our results, variations in trust are correlated more with the returns to being productive, rather than rent-seeking. In line with previous studies, our model shows that higher than average levels of risk-taking by agents lead to further trust and gains during an interaction, though taken to an extreme, both trust and gain can decline as a result of reckless decisions. We also report on the formation of trust clusters in our model as an emergent phenomenon.

By now you may have read some of the analysis of the federal Coalition government’s recent budget, or its Commission of Audit, which was released prior to the budget in an attempt to frame our economic challenges as a ‘budget emergency’. Australia has had tough budgets before, but five factors make the 2014-15 budget a low-point in Australia’s modern history and should continue to spur Christian leaders into outspoken and courageous resistance.

It is widely feared that environmental degradation induced by climate change may lead to economic and political insecurity through channels such as resource scarcity and mass migration. In this paper, we have developed an agent-based model to study whether resource scarcity is likely to lead to an increase in the appropriation of resources in environments where adaptive agents can allocate a fraction of their effort to predatory behavior. By enriching a production and conflict model through the introduction of separate product and resource appropriations, we show how boundedly-rational agents capable of learning can update their adaptive expectations and optimize their allocation decisions using a genetic framework. Arising from a few simple rules, the results show a high level of complexity in agents' allocation behavior with outputs ranging from no statistically significant allocation changes to widespread conflict in the environment, depending on the initial conditions and the nature of the scenarios. Overall the results support previous empirical findings that the main link between resource scarcity and conflict is through changes in the distribution of resources rather than their overall availability.

Bangladesh is one of the countries most vulnerable to climate change impacts such as extreme weather events, due to its low-lying topography, high population density and widespread poverty. In this paper, we report on the development and results of an agent-based model of the migration dynamics that may arise in Bangladesh as a result of climate change. The main modules are each calibrated with data on relevant indicators, such as the incidences of extreme poverty, socioeconomic vulnerability, demography, and historical drought, cyclone and flood patterns. The results suggest likely changes in population densities across Bangladesh due to migration from the drought-prone western districts and areas vulnerable to cyclones and floods in the south, towards northern and eastern districts. The model predicts between 3 and 10 million internal migrants over the next 40 years, depending on the severity of the hazards. Some associated policy considerations are also discussed.

The types of models used by economists to evaluate the impacts and effectiveness of aid have a substantial influence on aid and development policy and practice. In this chapter, two recent examples are discussed in which flaws in the modelling approaches resulted in poor policy recommendations: firstly the advocacy of ‘trade not aid’, and secondly the recommendation only to give aid to countries with ‘good’ policies. An overview of a recently-developed modelling framework is then presented, known as agent-based or multi-agent modelling, which is already being applied across a wide variety of fields, but which still seems relatively unknown in the aid and development literature. While not a magic bullet, agent-based modelling offers the potential to overcome many of the limitations of other modelling approaches, enabling the economic, social, political, legal, geospatial, epidemiological and environmental dimensions of development policy to be seamlessly integrated.

Production and conflict models have been used over the past 30 years to represent the effects of unproductive resource allocation in economics. Their major applications are in modelling the assignment of property rights, rent-seeking and defense economics. This paper describes the process of designing an agent used in a production and conflict model. Using the capabilities of an agent-based approach to economic modelling, we have enriched a simple decision-maker of the kind used in classic general equilibrium economic models, to build an adaptive and interactive agent which uses its own attributes, its neighbors' parameters and information from its environment to make resource allocation decisions. Our model presents emergent and adaptive behaviors than cannot be captured using classic production and conflict agents. Some possible extensions for future applications are also recommended.

While investors are advised to diversify in order to manage risk, developing countries are advised instead to liberalise their trade regimes and specialise according to their current comparative advantage. This study uses 67 regions of the GTAP database to investigate the effects of unilateral liberalisation and its impacts on countries’ economic structures and the extent to which this affects countries’ vulnerability to an economic shock.

While liberalisation resulted in improvements in GDP and welfare on average, there were significant variations. A number of countries experienced contractions in their GPDs and declines in welfare. While there was no evidence of a relationship between the percentage change in GDP and the initial export or output concentration, there was a positive relationship between the percentage change in GDP and the percentage change in export and output concentrations. On average, increases in GDP following liberalisation were associated with increases in concentration in both the export sector and in overall industrial output and also reductions in the fraction of unskilled labour employed by the main export sector. Initial GDP per capita has no significant effect, implying that once concentration measures and the fraction of costs in the main export are accounted for, the per capita income levels of a country show no systematic effects on the percentage change in GDP induced by the liberalisation. For developing countries undergoing unilateral liberalisation, the results imply that they are likely to experience an increase in GDP, but an increase accompanied by more highly concentrated industrial output and exports, and also a lower fraction of main export costs due to unskilled labour.

Following liberalisation, the responses of liberalised and non-liberalised versions of the region’s economies to a shock were compared. The rest of the world’s productivity in the country’s main export was increased by 10%, with the liberalised economies faring marginally worse on average in welfare and terms of trade effects, but slightly better on GDP effects. When the net effects of the initial liberalisation and subsequent technology shock were compared, countries were better off on average if they had liberalised. But this average masked important sectoral differences. Countries specialising in sectors with high proportions of own-commodity inputs in their main export’s total cost, such as manufacturing, did best, while those specialising in food tended to suffer welfare declines. Higher levels of export and output concentration also tended to reduce welfare. This suggests that increased concentration does indeed make countries more vulnerable to certain economic shocks. Finally, the economic network structures of the two extreme cases, Tanzania and Vietnam are compared visually as an aid to interpretation..

Any attempt to model an economy requires foundational assumptions about the relations between prices, values and the distribution of wealth. These assumptions exert a profound influence over the results of any model. Unfortunately, there are few areas in economics as vexed as the theory of value. I argue in this paper that the fundamental problem with past theories of value is that it is simply not possible to model the determination of value, the formation of prices and the distribution of income in a real economy with analytic mathematical models. All such attempts leave out crucial processes or make unrealistic assumptions which significantly affect the results.

In an age obsessed with economic efficiency and tax cuts, it is ironic that by allowing health systems in developing countries to deteriorate, the industrialised world is engaged in one of the most dangerous experiments in false economy in history.

In an era of stagnant or declining aid budgets, foreign direct investment offers significant scope for channelling much-needed resources to developing countries. However, a number of caveats must be borne in mind. FDI does not always lead to economic growth, and whether it does so depends critically on the local economic environment. FDI is also very geographically concentrated, meaning that most developing countries still require greatly increased aid flows to alleviate poverty, to build infrastructure and to develop sound institutions. Moreover, the FDI that is available has costs as well as benefits. Some studies have shown that up to a third of projects can be a net cost to the host country. Major FDI proposals should therefore be evaluated carefully in a comprehensive cost-benefit framework. This is a much-neglected, but essential skill and most developing countries require increased technical assistance and resources to build their capacities to undertake it. Neglecting sound cost-benefit analysis of FDI is a dangerous false economy. Corporate codes of conduct should be discussed in this context. Their utility is highly dependent on what they include, what they leave out and what procedures are in place for monitoring and enforcing them. Many fail on all counts. The better ones can be useful as an adjunct to a sound legal environment, or as a restraint in more chaotic circumstances, but they must not 'crowd out' the development of sound, well-enforced social, environmental, tax, anti-corruption and labour laws. Moreover, a company's adherence to an outstanding code of conduct does not automatically mean that its FDI will be beneficial to the host country. FDI by the perfect company in the wrong sector or in the wrong economic circumstances can still result in a net cost to the host country. Thorough cost-benefit analyses of proposed FDI projects remain essential.

For those afflicted with the ability to see shades of grey, the globalisation ‘debates’ can be enormously frustrating and perplexing. Entrenched interests on both sides slug it out with tired slogans and endless papers, speeches, meetings and marches. Here, I want to discuss some possible ways of strengthening the quality of the debates on globalisation and how some of these injustices can be addressed.

How best to assess trade and industrial policy in developing countries is a controversial question that unlocks a host of modelling complexities. Large computable general-equilibrium (CGE) models dominate many economic policy debates, but recent developments in the field have demonstrated that it is by no means clear that they give reliable results to questions of how trade reforms affect the poor. Over the last decade or so, a new approach to modelling complex systems has emerged using agent-based models (ABMs). This paper explores the question of whether ABMs are useful for economic policy-makers seeking to quantitatively model the effects of trade and industrial policies and whether constructive interfaces could be developed between CGE models and ABMs. The paper argues that in developing economic policy, ABMs can and should be used in conjunction with CGE models and that there is much to be gained from a greater understanding of the strengths and weaknesses of different modelling approaches, and what domains are most appropriate for their use. It concludes with some reflections on the reasons for the success of CGE approaches and ways in which ABMs could be made more widely understood and used among economists.