Qualitative and quantitative simulation of interacting markets

Traditional quantitative methods of analysis and simulation are compared with recently developed techniques in qualitative simulation by using as a case-study a simple dynamic model of the interacting markets for housing and mortgages. Analysis by the different techniques shows that while the qualitative simulation requires less detailed models, of the precision normally available in practice, it results in ambiguous descriptions of behaviour that for certain initial conditions can obscure the true behaviour. By contrast, quantitative simulation produces a unique precise behaviour, but in requiring excessively specific information of the modeller it may produce an inaccurate if precise outcome. © 1995.