Richardson, G. P. (1991). System dynamics: Simulation for policy analysis from a feedback perspective. In P. A. Fishwick & P. A. Luker (eds.), Qualitative simulation modeling and analysis. New York: Springer-Verlag

ABSTRACT

System dynamics is a computer-aided approach to policy analysis and design. With origins in servomechanisms engineering and management, the approach uses a perspective based on information feedback and circular causality to understand the dynamics of complex social systems. The loop concept underlying feedback and circular causality is not sufficient by itself, however. The explanatory power and insightfulness of feedback understandings also rest on the notions of active system structure and loop dominance, concepts that arise only in nonlinear systems. Computer simulation is the tool that makes it possible to trace the dynamic implications of nonlinear systems. The system dynamicist's feedback perspective is strengthened further by approaching complex problems from a particular conceptual distance, one that blurs discrete events and decisions into continuous patterns of behavior. This continuous view, expressed in stocks, flows, and information links, focuses not on discrete decisions but on the policy structure underlying decisions. This chapter describes the system dynamics approach and provides an entry into the literature in the field, It explores the wide range of diagramming tools used to conceptualize and explain the stock-and-flow feedback structure responsible for observed behavior. It discusses several simulation environments that are increasing our conceptual and technical modeling abilities and points to principles of systems that facilitate the formulation of insightful models. An example of policy analysis in school finance is sketched. The insights derived from that study are linked to a growing list of generic simulation-based policy insights in complex systems. The background of the field of system dynamics and its current directions are contained in an extensive bibliography.