Increasingly the economy of every nation is linked with the rest of the world through trade, loans across national boundaries, and multi-national business. The model INTECON (Figure IV-18) represents a nation's assets and growth as it is affected by international finance. In this model the currency of the nation that goes abroad returns by several pathways.

The total money supply is the sum of that at home and abroad. The money circulating across national boundaries counts in the gross national product of more than one country. The circulation of money helps accelerate growth of the world economy, but causes some countries to become debtors to others. Effects of fiscal policy are simulated by making "what if" changes on INTECON.

Examples

To various degrees all states and nations have their economies interconnected with patterns of world finance, but the availability of resources and provisions for exchange between countries makes a very uneven pattern of wealth. INTECON helps the study of the mechanisms of international finance that affect a country.

"What If" Experimental Problems

1. What is the effect of massive debt (D) where large interest and/or profits are being paid to other countries? Make D = 2.8 appropriate for the present U.S. debt.
   


2. What is the effect of increasing the interest rate? Change (IT) from 0.03 to 0.12 in the program. First consider the case where the home country has a large debt owed (D = 2.8); second consider the reverse case when the outside countries are in debt to the home country (ID = 10).
   


3. What is the effect of increasing the home country's money supply (TM) which includes $ at home and abroad? Make TM 4.
   


4. What is the effect of a lower depreciation rate of the country's assets (Q), which makes a shorter turnover time? Change K8 from 0.02 to 0.1.

COMPUTER MINIMODELS AND SIMULATION EXERCISES FOR SCIENCE AND SOCIAL STUDIES

Howard T. Odum* and Elisabeth C. Odum+
* Dept. of Environmental Engineering Sciences, UF
+ Santa Fe Community College, Gainesville

Center for Environmental Policy, 424 Black Hall
University of Florida, Gainesville, FL, 32611
Copyright 1994

Autorização concedida gentilmente pelos autores para publicação na Internet
Laboratório de Engenharia Ecológica e Informática Aplicada - LEIA - Unicamp
Enrique Ortega
Mileine Furlanetti de Lima Zanghetin
Campinas, SP, 20 de julho de 2007