Predator-Prey analysis using system dynamics: An application to the steel industry
Douglas John Crookes, James Nelson Blignaut
SAJEMS Asset research NS 19 (2016) No 5:733-746
In this paper, we use a predator–prey model to simulate intersectoral dynamics, with the global steel sector
as the prey that supplies inputs and the automotive sector as the predator that demands its inputs. A further
prey, an additional upstream supply sector, namely the iron ore sector, is added to reflect the implications of
scarcity and resource limitations for industrial development and economic prospects. We find that capacity
constraints in the steel industry could limit the future supply of vehicles, a result exacerbated by the
unsustainable use of iron ore reserves. The solution is not for marginal steel industries to close, but for
steelmakers to adapt and move to less resource-demanding secondary steelmaking technology rather than
focusing on primary steelmaking. The forecasting capabilities of the model are compared with the outputs
from a neural-network model. Although the results are comparable over the short term (±10 years), over the
long term, results diverge, showing that forecasting steel-industry dynamics is complex and that further work
is required to disentangle the drivers of supply and demand. This study indicates the potential advantages
of using predator–prey models in modelling the supply chain in economics.
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