About




The purpose of this blog is to discuss state space models developed for the period 1950-2000 with forecasts typically out to 2100.


Model Code here

Comments

Post a Comment

Popular posts from this blog

World-System (1950-2190) Will US and Israel Attacks on Iran Hurt the World System?

Image
The IMF is warning ( here ) that US Strikes on Iranian Nuclear facilities could disrupt the World Economy. The major concern seems to be with the impacts on Energy Markets (25% of the seaborn oil trade goes through the Straits of Hormuz ). The IMF has been forecasting slower global growth rates and disruptions in Iran would further affect growth prospects.  The stated intention for bombing Iranian Nuclear facilities is to prevent Iran from getting an atomic bomb.  However, Kenneth Waltz has argued ( here ) that Iran should get the bomb for nuclear balancing and stability in the Middle East. The Trump II Administration has recently signaled that they want Iran to continue as a strong economy in the World-System . The danger is that bombing Iran would lead to a system collapse similar to Syria ( here ). The question again is how important is Iran to the World-System ? The graphic above shows that disabling Iran for 20 years would be a big hit for the World System. If Ira...
Read more

World-System (1950-2000+) How Does the Iranian Economy Work?

Image
  According to Google AI, the Economy of Iran is facing "significant challenges"   to include international sanctions, inflation, currency devaluation, economic stagnation, corruption/mismanagement, dependence on oil, and brain drain. My forecasts for the  Economy of Iran  are equally pessimistic ( here ). On the other hand, if the  Economy of Iran   were entirely cut out of the World-System (say for twenty years), the World-System would take a big hit ( here ). Before we make any conclusions about either qualitative or quantitative forecasts, it would be useful to understand how the  Economy of Iran   works ( HINT : It's an historically driven economy not a Neoclassical Economy ). From the perspective of   Systems Theory,  the first step is to estimate the state variables (the measurement matrix for the Dynamic Components  state space model is presented in the Notes below). There are three state variables (estimated by Pr...
Read more

World-System (1950-2025) Switzerland, the US and Trump Tariffs

Image
Switzerland's ( CH ) Splendid Geopolitical Isolation  was shattered last week as the Trump II Administration  imposed 39% Tariffs on most Swiss imports (Pharmaceuticals were exempt for the time being ). ChatGPT  reports that there were three main reasons: (1) Trade Imbalances, (2) Lack of "Reciprocity" in Terms of Trade and (3) a Breakdown in Ongoing Negotiations (see more detail in the Notes below). What's going on  between Switzerland ( CH ) and the US ? In terms of my State Space Models (see the Boiler Plate ), Geopolitical linkage between the US and Switzerland would not be beneficial for Switzerland. In the graphic above, using the US_LM model as input would result in immediate collapse; using the USL203 model as input would result in a future of unstable cycles. Switzerland needs to keep it's Geopolitical distance from the US and conduct Business-as-Usual ( BAU ) as much as possible. If that is not possible, taking a Random Walk ( RW ) to find a bet...
Read more