(Part of the Prediction-Thread)
On 4 May 2002, Scott Moss (2002) reported in the Proceedings of the National Academy of Sciences of the United States of America that he had recently approached the e-mail discussion list of the International Institute of Forecasters to ask whether anyone had an example of a correct econometric forecast of an extreme event. None of the respondents were able to provide a satisfactory answer.
As reported by Hassan et al. (2013), on 28 April 2009, Scott Moss asked a similar question of the members of the SIMSOC mailing list: “Does anyone know of a correct, real-time, model-based policy-impact forecast?”  No-one responded with such an example, and Hassan et al. note that the ensuing discussion questioned why we are bothering with agent-based models (ABMs). Papers such as Epstein’s (2008) suggest this is not an uncommon conversation.
On 23 March 2018, I wrote an email  to the SIMSOC mailing list asking for expressions of interest in a prediction competition to be held at the Social Simulation Conference in Stockholm in 2018. I received two such expressions, and consequently announced on 10 May 2018 that the competition would go ahead.  By 22 May 2018, however, one of the two had pulled out because of lack of data, and I contacted the list to say the competition would be replaced with a workshop. 
Why the problem with prediction? As Edmonds (2017), discussing different modelling purposes, says, prediction is extremely challenging in the type of complex social system in which an agent-based model would justifiably be applied. He doesn’t go as far as stating that prediction is impossible; but with Aodha (2017, p. 819) he says, in the final chapter of the same book, that modellers should “stop using the word predict” and policymakers should “stop expecting the word predict”. At a minimum, this suggests a strong aversion to prediction within the social simulation community.
Nagel (1979) gives attention to why prediction is hard in the social sciences. Not least amongst the reasons offered is the fact that social systems may adapt according to predictions made – whether those predictions are right or wrong. Nagel gives two examples of this: suicidal predictions are those in which a predicted event does not happen because steps are taken to avert the predicted event; self-fulfilling prophecies are events that occur largely because they have been predicted, but arguably would not have occurred otherwise.
The advent of empirical ABM, as hailed by Janssen and Ostrom’s (2006) editorial introduction to a special issue of Ecology and Society on the subject, naturally raises the question of using ABMs to make predictions, at least insofar as “predict” in this context means using an ABM to generate new knowledge about the empirical world that can be tested by observing it. There are various reasons why developing ABMs with the purpose of prediction is a goal worth pursuing. Three of them are:
- Developing predictions, Edmonds (2017) notes, is an iterative process, requiring testing and adapting a model against various data. Engaging with such a process with ABMs offers vital opportunities to learn and develop methodology, not least on the collection and use of data in ABMs, but also in areas such as model design, calibration, validation and sensitivity analysis. We should expect, or at least be prepared for, our predictions to fail often. Then, the value is in what we learn from these failures, both about the systems we are modelling, and about the approach taken.
- There is undeniably a demand for predictions in complex social systems. That demand will not go away just because a small group of people claim that prediction is impossible. A key question is how we want that demand to be met. Presumably at least some of the people engaged in empirical ABM have chosen an agent-based approach over simpler, more established alternatives because they believe ABMs to be sufficiently better to be worth the extra effort of their development. We don’t know whether ABMs can be better at prediction, but such knowledge would at least be useful.
- Edmonds (2017) says that predictions should be reliable and useful. Reliability pertains both to having a reasonable comprehension of the conditions of application of the model, and to the predictions being consistently right when the conditions apply. Usefulness means that the knowledge the prediction supplies is of value with respect to its accuracy. For example, a weather forecast stating that tomorrow the mean temperature on the Earth’s surface will be between –100 and +100 Celsius is not especially useful (at least to its inhabitants). However, a more general point is that we are accustomed to predictions being phrased in particular ways because of the methods used to generate them. Attempting prediction using ABM may lead to a situation in which we develop different language around prediction, which in turn could have added benefits: (a) gaining a better understanding of what ABM offers that other approaches do not; (b) managing the expectations of those who demand predictions regarding what predictions should look like.
Prediction is not the only reason to engage in a modelling exercise. However, in future if the social simulation community is asked for an example of a correct prediction of an ABM, it would be desirable to be able to point to a body of research and methodology that has been developed as a result of trying to achieve this aim, and ideally to be able to supply a number of examples of success. This would be better than a fraught conversation about the point of modelling, and consequent attempts to divert attention to all of the other reasons to build an ABM that aren’t to do with prediction. To this end, it would be good if the social simulation community embraced the challenge, and provided a supportive environment to those with the courage to take it on.
- https://www.jiscmail.ac.uk/cgi-bin/webadmin?A2=simsoc;fb704db4.0904 (Cited in Hassan et al. (2013))
Aodha, L. n. and Edmonds, B. (2017) Some pitfalls to beware when applying models to issues of policy relevance. In Edmonds, B. and Meyer, R. (eds.) Simulating Social Complexity. Second Edition. Springer. pp. 801-822.
Edmonds, B. (2017) Different modelling purposes. In Edmonds, B. and Meyer, R. (eds.) Simulating Social Complexity. Second Edition. Springer. pp. 39-58.
Epstein, J. (2008) Why model? Journal of Artificial Societies and Social Simulation 11 (4), 12. http://jasss.soc.surrey.ac.uk/11/4/12.html
Hassan, S., Arroyo, J., Galán, J. M., Antunes, L. and Pavón, J. (2013) Asking the oracle: introducing forecasting principles into agent-based modelling. Journal of Artificial Societies and Social Simulation 16 (3), 13. http://jasss.soc.surrey.ac.uk/16/3/13.html
Janssen, M. A. and Ostrom, E. (2006) Empirically based, agent-based models. Ecology and Society 11 (2), 37. http://www.ecologyandsociety.org/vol11/iss2/art37/
Moss, S. (2002) Policy analysis from first principles. Proceedings of the National Academy of Sciences of the United States of America 99 (suppl. 3), 7267-7274. http://doi.org/10.1073/pnas.092080699
Nagel, E. (1979) The Structure of Science: Problems in the Logic of Scientific Explanation. Hackett Publishing Company.
Polhill, G. (2018) Why the social simulation community should tackle prediction, Review of Artificial Societies and Social Simulation, 6th August 2018. https://rofasss.org/2018/08/06/gp/