In this paper an agent-based model of self organized criticality is developed in a network economy characterized by lead time and a threshold behavior of firms. Instead of considering the aggregate production of the economy as a whole, we focus on both the propagation and amplification effects of a demand shock in the sectorial productions of a multi-agent supply chain. We study a static network structure representing a relation of firms in a lower-upper stream in an industrial organization. In our model, the individual (R, nQ) policies play an important role in generating a propagation effect across the different layers of the economy, and the propagation turns into the large fluctuations and amplifications of sectorial productions.
Lacagnina, V., Provenzano, D. (2010). Threshold rule and scaling behavior in a multi-agent supply chain. In M. Li Calzi, L. Milone, P. Pellizzari (a cura di), Progress in artificial economics. Computational and agent-based models (pp. 139-150). Heidelberg : Springer [10.1007/978-3-642-13947-5_12].