This paper describes the need for understanding the role of financial markets in successful product development in the global context. Agent-based models distinguish themselves by their ability to generate many real world phenomena endogenously, rather than as a result of ad-hoc assumptions. We report on a model of global financial markets employing the following agents: countries, firms, stock traders, country banks, and a global bank. These agents interact with goods, credit, currency, and stock markets. The model endogenously generated quantitative and qualitative features of real economies, including skewed firm sizes, skewed country GNP’s, skewed stock trader portfolio values, and heavy-tailed non-Gaussian firm growth rate, exchange rate fluctuation, and stock return distributions. Multiple runs were performed with different random number generator seeds to investigate the stability or instability of the economies grown by the model. Both stable and unstable country economies were detected. The multiple runs also verified conclusions drawn from analyzing individual runs showing how small countries could be buffeted by fluctuations in larger countries. Such a model can be used by product development organizations to understand the impacts of their product development decisions in the context of dynamic and unpredictable financial markets.
The Role of Non-Gaussian Sources in the Transient Dynamics of Long Josephson Junctions