An Agent-Based Financial Simulation for Use by Researchers

Regulators and policy makers, facing a complicated, fast-paced and quickly evolving marketplace, require new tools and decision aides to inform policy. Agent-based models, which are capable of capturing the organization of exchanges, intricacies of market mechanisms, and the heterogeneity of market participants, offer a powerful method for understanding the financial marketplace. To this end, we have worked to develop a flexible and adaptable agent-based model of financial markets that can be extended and applied to interesting policy questions. This paper presents the implementation of this model. In addition, it provides a small case study that demonstrates the possible uses of the model. The source code of the simulation has also been released and is available for use.