Keynes in the computer laboratory. An agent- based model with MEC, MPC, LP.

The present paper aims at taking the core of Keynes ’s macroeconomics - as it is portrayed in the 1937’s QJE paper - into the computer laboratory, in the spirit of a “counterfactual history of economic thought”. We design an agent-based model in which the principal role in determining economic dy namics is played by the three pillars of Keynesian economics, namely the Marginal Efficiency of Capital, the Marginal Propensity to Consume and the Liquidity Preference. The latter magnitudes are modelled with particular attention to the ir behavioural foundations. Indeed, in Keynes’s thought, such behavioural foundat ions result greatly important in determining the development of the business cycl e. Simulation results endorse this view, with our model being able to recreate ec onomic fluctuations with interesting statistical properties.