ModelSIM Run Exploratory
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- Money Supply Velocity
Money supply velocity is calculated as such: Change, from one financial quarter to the next, in net-financial asset flow as a percentage of income (GDP).
- Fiscal Balance
This is the government sector fiscal balance, either in surplus (a money flow away from the non-government sector), or more typically (and always in ModelSIM), in deficit (a money flow toward the non-government sector).
- Marginal Taxation Supply
This is the total payments returned to the government agent by consumer agents since the inception of marginal taxation brackets.
- Consumer Rating
Consumer agent (rating) approval, disapproval or ambivalence of the Government agent will depend on individual wealth (cash equity) at the end of each model iteration.
Model Run Parameters
- Government Agent = 1
- Producer Agents = 100
- Consumer Agents = 110
At the beginning of every model iteration all producer agents receive an equal share of new expenditures from government for the period.
Expenditures Period 1 (1960 - 2019)
USA Real-world total managed expenditure (sum to annual) data source starting 1960, ending 2018.
U.S. Bureau of Economic Analysis, Government total expenditures [W068RCQ027SBEA], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/W068RCQ027SBEA.
Flat Rate Taxation
Set at 37% of all consumer agent income.
Expenditures Period 2 (2020 - 2050)
The year is 2020: The State emerges with a plan to pursue the public purpose. Government establishes Regional Improvement Agents (RIAs), formerly known as producer agents.
- Government agent funding of RIAs will increase at 4% per annum (in every model iteration that follows 2019).
- RIAs will purchase non-financial assets only.
- Marginal rate taxation will apply to all government expenditures flowing though RIAs.
- Securitisation of 'additional' RIA project financing must equal in amount private finance purchasing of 0% coupon RIA bonds made available by government. This is, in effect, a tax payment in advance.
Marginal Rate Taxation
A 'historical average wage' is calculated in each iteration. The 'historical average wage' is used in the current iteration to apply marginal rate taxation.Brackets:
- Tax Bracket 0: No tax on a wage amount up to the first 50% of the historical average wage.
- Tax Bracket 1: Pay 60% tax on any remaining wage amount that is between 50% and 100% of the historical average wage.
- Tax Bracket 2: Pay 70% tax on any remaining wage amount that exceeds 100% of the historical average wage.
Model Iteration Historical Average Wage: 36253.103 (Previous iteration).
- Consumer agent 5 is paid 40235.84. A flat rate tax of 14887.26 would have been returned. Under marginal rate tax, 13663.85 is returned.
- Consumer agent 10 is paid 24380.53. A flat rate tax of 9020.80 would have been returned. Under marginal rate tax, 3752.39 is returned.
- Consumer agent 8 is paid 62032.38. A flat rate tax of 22951.98 would have been returned. Under the marginal rate tax, 28921.42 is returned.
Consumer Agent 8 Marginal Tax Return Breakdown
50% of historical average wage amount at iteration 6: (36253.103 / 2) = 18126.55
- No tax on wage amount up to the first 50% of the historical average wage amount.
- Tax on wage amount that is between 50% and 100% of the historical average wage amount (18126.55 * 60%) = 10875.93
- Tax on wage amount that exceeds 100% of the historical average wage amount ((62032.38 - 36253.10) * 70%) = 18045.49
- Proportion of disposable income: 60%
- Proportion of (agent wealth) at the opening of the period (quarter): 40%