A System Dynamics Model of Mining Industry Investment Decisions within the Context of Environmental Policy

This paper describes a detailed computer model developed using the Powersim simulation program in the system dynamics tradition. The model comprises over 180 interrelated variables, providing a means of examining the effects of varied environmental, fiscal and corporate policies on the flow of investment funds and mineral resources between a number of simulated mining firms and competing countries. An outline of the system dynamics method is presented, followed by a high-level overview of the model structure. Examples of the application of the model are then discussed.