5. Simulation and Modelling: Econometric Technique

Modelling and simulation are important working techniques of econometrics, but they are also a series of peculiarities, which form them in a distinct category. Any econometric model has the variables: the subject, theory, object of the research and information. These econometric models are always subject to a matrix calculus. In the category of econometric models, the input-output model used in the theory of Leontieff is a series of special features that distinguish it from other models. Production and optimisation models are also used, and the model of the IQ calculated for each employee is used for human resources. Unlike modelling, as an econometric technique the simulation applies in production a model that has been created based on the conclusions drawn from reality, but which have great power of generalisation. The simulation technique uses models to simulate the industrial production and particularly models based on artificial intelligence. Any expert system used in the modeling of industrial production involves studying specificity of production technology and then adapting it to a specific expert system.