Empirically based agent-based models

Earlier, we have mentioned the relation between ACE and experimental economics with specific reference to the mirroring function (Chapter 6).1 This goal generally applies to other ACE models which deal directly with actual field data instead of experimental data. While there are still a lot of ACE researchers considering their model exclusively for thought experiments, there is an increasing interest in building “empirically based, agent-based models” (Janssen and Ostrom, 2006). This requires ACE researchers to validate their models with real data, and has further developed ACE into econometric models which may be estimated by standard econometrics or other less standard estimation approaches. Maybe the most mature area to see the connection between ACE and econometrics is once again agent-based financial models.