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1
Experimental Economics and Machine Learning
for Prediction of Emergent Economy Dynamics
Arnold Kiv
Ben-Gurion University of the Negev, P.O.B. 653, Beer Sheva, 8410501, Israel
kiv@bgu.ac.il
Serhiy Semerikov[0000-0003-0789-0272], Vladimir Soloviev2[0000-0002-4945-202X]
Kryvyi Rih State Pedagogical University, 54, Gagarin Ave., Kryvyi Rih, 50086, Ukraine
{semerikov, vnsoloviev2016}@gmail.com
Liubov Kibalnyk[0000-0001-7659-5627], Hanna Danylchuk[0000-0001-9240-1976]
Bohdan Khmelnytsky National University of Cherkasy, 81, Shevchenko Blvd., Cherkasy,
18000, Ukraine
liubovkibalnyk@gmail.com, abdanilchuk@gmail.com
Andriy Matviychuk[000-0002-8911-5677]
Kyiv National Economic University named after Vadym Hetman, 54/1, Peremogy Ave., Kyiv,
03680, Ukraine
editor@nfmte.com
Abstract. This is an introductory text to a collection of selected papers from the
M3E2 2019: The 8th International Conference on Monitoring, Modeling &
Management of Emergent Economy, which was held in Odessa, Ukraine, on the
May 22-24, 2019. It consists of short introducation and some observations about
the event and its future.
Keywords: experimental economics, machine learning, prediction of emergent
economy dynamics.
1 Introduction
Nowadays in conditions of the world space transformation, the role of individual
countries and their groups varies considerably. Priorities for ensuring sustainable
growth of the world economy are distributed between countries and their groups
unevenly. It is influenced by the global economic situation cycles, by potential and
possibilities for realizing the achievements of information and technological progress,
by the newest dominant tendencies of geographic and regional development, etc. As a
result, some countries are ahead of others in the terms of economic growth. The
specificity of the modern world economic system lies in the fact that global economic
2
growth depends on the implementation of national economic potential, the ability to
apply existing and acquired factors of economic dynamics at the level of individual
countries.
One of the key characteristics of the structure of the modern world economy is the
presence of a group of countries with emergent markets. The established classification
of countries with growing (ascending, emergent) markets in the scientific literature is
not formed, however, there are several research approaches regarding the content and
criteria for identifying this group of countries. According to world-class scientists such
as V. Kvint [1], T. Marois [2], M. A. Kose and E. S. Prasad [3], as well as according to
international financial institutions, research centers (such as the British company FTSE,
the corporation MSCI, the American financial company S&P, the American financial
information firm Dow Jones & Company, Frontier Strategy Group, etc.), that deeply
studied this problem, the formation of emergent markets in the world is associated with
the presence of four main characteristics.
The essence of the first one is that this group includes countries with a large
population, resource base and high-volume markets, that are the engines of economic
development in different regions of the world. The second feature is the transitive type
of society, and specifically – implementation of internal economic and political
reforms, the introduction of a policy of “openness” instead of a policy of strong state
planning and control. The next feature is high rate of economic growth, as a result of
the country’s active participation in international trade process. And the last feature is
the significant growth of domestic and foreign investments due to the formation of a
favorable environment for conducting business within the country.
At the same time, according to the experts of the Institute of Economics and
Forecasting of the National Academy of Sciences of Ukraine, the issues of determining
clear criteria for classification of countries belonging to this group remain unsolved,
especially with relatively small area of the territory (less than 1 million square
kilometers), as well as with limited market liquidity (in particular, Ukraine).
According to their opinion in Ukraine the problems of the intensification of the
processes of emergence of the economy are hampered by the problems of low
innovation activity of domestic enterprises, the volatility of foreign economic activity
and the instability of the political situation. Therefore, we offer some steps towards the
formation of well-developed emergency economics in Ukraine. Among them: the
financing of technological parks through venture capital funds with a minimum state
participation, which should be the guarantor of the reliability of private investment; the
creation of a stock market, the forecasts of which will allow you to navigate the
dynamics of stock quotes, that in the case of coincidence of real and predicted values
will indicate the correctness of the decisions on investing in certain innovative
enterprises; commercialization of scientific developments at the expense of enterprises
and research institutions entering the international market of innovative technologies
by joining the system of technology transfer INDEV of the State Committee for
Investment and Development, etc.
Publications in the scientific literature prove a high level of interest in the theoretical
and applied developments concerning the peculiarities and dynamics of the
development of the countries of the emergent type. However, questions about the
3
application of modern methods of investigation of the emergent properties of complex
systems, sources and methods to the process of formation the emergent strategy of the
country as a whole and Ukraine in particular are still remain insufficiently studied.
In modern science, the achievements of modern mathematics, system analysis,
decision-making theory, and so on are used to model and analyze the complex systems
functioning. At the same time, the processes of globalization and integration, financial
and economic instability cause the need to find out new tools that take into account
elements of uncertainty, a significant number of risks and promote the efficiency of
simulation processes.
The scientific contribution of modern scholars can be a guarantee for the
improvement of the activities of various economic actors, the basis for the development
of operational and strategic plans and programs of business and government activities.
This collection of scientific works includes the research results of scientists aimed at
improving the existing and developing new approaches in the modeling, management
and monitoring of the emergent economy as a complex system.
2 M3E2 2019 at a Glance
Monitoring, Modeling & Management of Emergent Economy (M3E2) is a peer-
reviewed international conference focusing on research advances and applications of
nonlinear dynamics methods, econophysics and complex systems methodology of
emergent economy.
The M3E2 Conference occupies contributions in all aspects of Computational
Finance, Economics, Risk Management, Statistical Finance, Trading and Market
Microstructure, (Deep) Machine Learning technologies and tools, paradigms and
models, relevant to modern financial engineering and technological decisions in the
modern age. There is urgent general need for principled changes in postclassic economy
elicited by current models, tools, services, networks and IT communication.
M3E2 topics of interest:
─ Complex cyberphysical systems, synergy, econophysics, economy of agents.
─ Mathematical methods, models, informational systems and technologies in
economics.
─ Monitoring, modeling, forecasting and preemption of crisis in socio-economic
systems.
─ Models of global transformations.
─ Experimental economics.
─ The dynamics of emergent markets in post crisis period.
─ Management of the state’s economic safety and economic safety of economic agents.
─ Modeling of hospitality sphere development.
─ Prioritized ways of formation of the innovation model of Ukrainian economical
development.
─ The Global Challenges for Economic Theory and Practice in CEE Countries.
─ (Deep) Machine Learning for prediction of emergent economy dynamics.
─ Risk Management models in emergent economy.
4
This volume contains the selected papers presented at M3E2 2019: The 8th
International Conference on Monitoring, Modeling & Management of Emergent
Economy held on May 22-24, 2019 in Odessa, Ukraine.
There were 71 submissions. Each submission was reviewed by at least 3, and on the
average 3.1, program committee members. The committee decided to accept 38 papers.
3 Conclusion
The vision of the M3E2 2019 is provides a premier interdisciplinary platform for
researchers, practitioners and educators to present and discuss the most recent
innovations, trends, and concerns as well as practical challenges encountered and
solutions adopted in the fields of emergent economy.
The conference has successfully performing forum to transferring and discussing
research result among the researcher, students, government, private sector or industries.
Participants and presenters from several countries such as Czechia, Italy, Israel,
Lithuania, Poland, Slovenia, Ukraine have attended the conference to share their
significant contribution in research related to Monitoring, Modeling & Management of
Emergent Economy.
We are thankful to all the authors who submitted papers and the delegates for their
participation and their interest in M3E2 as a platform to share their ideas and
innovation. Also, we are also thankful to all the program committee members for
providing continuous guidance and efforts taken by peer reviewers contributed to
improve the quality of papers provided constructive critical comments, improvements
and corrections to the authors are gratefully appreciated for their contribution to the
success of the conference [4].
We hope you enjoy this conference and meet again in more friendly, hilarious, and
happiness of further M3E2 2020.
References
1. Kvint, V.: Strategy for the Global Market: Theory and Practical Applications. Routlegde,
New York (2016)
2. Marois, T.: Towards a Green Public Bank in the Public Interest. UNRISD Working Paper
2018-3. http://hdl.handle.net/10419/186113 (2018). Accessed 21 Mar 2019
3. Kose, M.A., Prasad, E.S.: Emerging Markets: Resilience and Growth amid Global Turmoil.
Brookings Institution Press, Washington (2010)
4. Semerikov, S., Soloviev, V., Kibalnyk, L., Chernyak O., Danylchuk, H.: M3E2 2019 -
Towards a new economy in the public interest. SHS Web of Conferences. 65, 00001 (2019).
doi:10.1051/shsconf/20196500001