Misadventures with Little’s Law

I’ve been working on a vehicle fleet model, re-implementing a spreadsheet in Ventity, using dynamic cohorts.

The vehicle lifetime in the spreadsheet is 11 years, and it’s discrete. This means that every vehicle retires precisely 11 years after it’s put into service. This raised a red flag for me, because it represents a rather short vehicle lifetime. I know from work in other jurisdictions that the average life of a vehicle is more like 16-18 years typically (and getting longer as quality improves).

So, where does the 11 year figure come from? We’re not sure. Other published data for the region indicates an average vehicle age of 8.5 years, so it’s not that. A Ventana colleague pointed out that it might be a steady-state estimate from combining vehicle fleet data with new vehicle sales data:

 

Given the data (red), assume that the vehicle stock is in equilibrium (inflow=outflow). Then it follows from Little’s Law that the average lifetime of vehicles must be 11 years. Little’s Law works regardless of the delay distribution, i.e. regardless of the delay order, but if you were formulating the fleet as a first-order system, that’s precisely how you’d write the outflow equation: outflow = fleet/lifetime, with lifetime=11 years.

… the long-term average number L of customers in a stationary system is equal to the long-term average effective arrival rate λ multiplied by the average time W that a customer spends in the system. – Wikipedia

However, there’s a danger here. The system might not be in equilibrium. Then both the assumption of inflow=0utflow and the stationarity required in Little’s Law. Vehicle sales are, unfortunately, rather volatile, particularly around events like the 2008 recession:

It’s tempting to use the average age of vehicles as another data point, but that turns out to be a bad idea. The average age of vehicles is sensitive to both variations in the inflow and the assumed distribution of the discard process. The following Ventity model illustrates this problem, using some of the same machinery as last week’s Erlang model.

As before, there’s a population of entities (agents). Each has a cascade of N internal states, represented by a stock counter, and an age that increases continuously. An entity deletes itself when it’s too old, or its state count is too high.

For accounting purposes, when an entity “dies” it records the event by incrementing counter stocks in the Model entity:

In this way, we can keep track of how old the average entity was at the time it deleted itself. This should be the average residence time in Little’s Law. We can also track the average age of existing entities, to see whether it’s the same.

First, consider a very simple, very nonstationary special case, in which there’s no flow of entity turnover. There’s only an initial population of entities of age 0, who gradually leave the system. Here are three variants of that experiment:

Set Model.Delay tau = 50 and Model.Flow Start Time = 1000 to replicate this experiment.

The blue line is the stochastic population analog of the classic first-order delay. The probability of a given entity departing is constant over time, as for radioactive decay. Therefore we get exponential decay, with count = N0*exp(-time/Delay tau). The red line is the third-order equivalent, yielding an Erlang 3 distribution. The green line is the pipeline delay equivalent, in which all entities self-delete at a specified age, rather than with a random distribution. Therefore the population steps from 1000 to 0 at time 50.

The two lower panels compare the average age of surviving entities (middle) to the average age at which entities self-delete (bottom). At bottom, you can see that all variants eventually converge to (roughly) the expected 50-year entity lifespan. However, each trajectory initially indicates a shorter lifespan. This is due to a form of censoring bias – at a given point in time, the longest-lived entities have not yet been observed.

The middle panel indicates how average age can mislead. In this case, age=time for all entities, and therefore the average age increases linearly, even though the expected residence time is constant.

At the opposite extreme, here’s an experiment with a constant flow of new agents, so that the system is in equilibrium after a few time constants:

Set Model.Delay tau = 20 and Model.Flow Start Time = 0 to replicate this experiment.

After the initial transient has died out (by time 20 to 60), all 3 residence times (age at deletion) converge to the expected value of 20. But notice the ages. They converge, too, but the value is dependent on the distribution. For the 1st-order system (blue), the average age does equal the average residence time of 20 years. But the pipeline system (green) has an average age that’s half that, at 10 years. This makes sense, if you think about an equilibrium population composed of a uniform mix of ages between 0 and 20 years. The 3rd-order system is in between.

This uncertain relationship between age and residence time means that we can’t use the average age of the vehicle fleet to determine the rate of vehicle turnover. That’s too bad, because age is the one statistic that’s easy to compute from a database of vehicle registrations. To know more, we have to start making inferences about the inflows and outflows – but that’s tricky if data coverage varies with time. Unfortunately, this is a number that we care about, because the residence time of vehicles in the system is an important driver of future penetration of low-carbon technologies.

The model: AgentAge2.zip

The Delay Sandbox can be used to explore similar phenomena in a continuous, aggregate, deterministic setting.

Aging Chains and the Erlang Distribution

My Delay Sandbox model illustrates the correspondence between Nth-order delays and the Erlang distribution (among other things).

Delay Sandbox

This model provides some similar insights – this time in Ventity. It’s a hybrid of classic continuous SD and agent equivalents.

First, the Erlang3 entitytype compares the classic 3rd-order aging chain’s behavior to analytical equivalents, as in the Delay Sandbox. The analytic values are computed in a set of Ventity’s new macros:

Notice that the variances, which arise from Euler integration with a finite time step, are small enough to be uninteresting.

Second, the model compares the dynamics of discrete agent populations to the analytic Erlang results. To do this, the Model entity creates populations of agents at time 0, and (for comparison) computes the expected surviving population according to the Erlang distribution:

The agents live for a time, then self-delete according to two different strategies:

On the left, an agent tracks its own age, and has an age-specific probability of mortality (again, thanks to the hazard rate of the Erlang distribution). On the right, an agent has a state counter, and mortality occurs when the number of state transitions reaches 3.

We can then compare the surviving agent populations (blue) to the Erlang expectation (red):

When the population is small (above, 100), there’s some stochastic variation around the expected result. But for larger populations, the difference is negligible.

The model: Erlang3 4 (2).zip

A System Zoo

I just picked up a copy of Hartmut Bossel’s excellent System Zoo 1, which I’d seen years ago in German, but only recently discovered in English. This is the first of a series of books on modeling – it covers simple systems (integration, exponential growth and decay), logistic growth and variants, oscillations and chaos, and some interesting engineering systems (heat flow, gliders searching for thermals). These are high quality models, with units that balance, well-documented by the book. Every one I’ve tried runs in Vensim PLE so they’re great for teaching.

I haven’t had a chance to work my way through the System Zoo 2 (natural systems – climate, ecosystems, resources) and System Zoo 3 (economy, society, development), but I’m pretty confident that they’re equally interesting.

You can get the models for all three books, in English, from the Uni Kassel Center for Environmental Systems Research – it’s now easy to find a .zip archive of the zoo models for the whole series, in Vensim .mdl format, on CESR’s home page: www2.cesr.de/downloads.

To tantalize you, here are some images of model output from Zoo 1. First, a phase map of a bistable oscillator, which was so interesting that I built one with my kids, using legos and neodymium magnets:

Continue reading “A System Zoo”

Delay Sandbox

There’s a handy rule of thumb for estimating how much of the input to a first order delay has propagated through as output: after three time constants, 95%. (This is the same as the rule for estimating how much material has left a stock that is decaying exponentially – about a 2/3 after one lifetime, 85% after two, 95% after three, and 99% after five lifetimes.)

I recently wanted rules of thumb for other delay structures (third order or higher), so I built myself a simple model to facilitate playing with delays. It uses Vensim’s DELAY N function, to make it easy to change the delay order.

Here’s the structure:

Continue reading “Delay Sandbox”

The Rise and Fall of the Saturday Evening Post

Replicated by David Sirkin and Julio Gomez from Hall, R. I. 1976. A system pathology of an organization: The rise and fall of the old Saturday Evening Post. Administrative Science Quarterly 21(2): 185-211. (JSTOR link). Just updated for newer Vensim versions.

This is one of the classic models on the Desert Island Dynamics list.

There are some units issues, preserved from the original by David and Julio. As I update it, I also wonder if there are some inconsistencies in the accounting for the subscription pipeline. Please report back here if you find anything interesting.

satevepost2011b.mdl

satevepost2011b.vmf

Fibonacci Rabbits

This is a small, discrete time model that explores the physical interpretation of the Fibonacci sequence. See my blog post about this model for details.

Fibonacci2.vpm This runs with Vensim PLE, but users might want to use the Model Reader in order to load the included .cin file with non-growing eigenvector settings.

Oscillation from a purely positive loop

Replicated by Mohammad Mojtahedzadeh from Alan Graham’s thesis, or created anew with the same inspiration. He created these models in the course of his thesis work on structural analysis through pathway participation matrices.

Alan Graham, 1977. Principles on the Relationship Between Structure and Behavior of Dynamic Systems. MIT Thesis. Page 76+

These models are pure positive feedback loops that don’t exhibit exponential growth (under the right initial conditions). See my blog post for a discussion of the details.

These are generic models, and therefore don’t have units. All should run with Vensim PLE, except the generic gain matrix version which uses arrays and therefore requires an advanced version or the Model Reader.

The original 4th order model, replicated from Alan’s thesis: PurePosOscill4.vpm – note that this includes a .cin file with an alternate stable initialization.

My slightly modified version, permitting initialization with different gains at each level: PurePosOscill4alt.vpm

Loops of different orders: 3.vpm 6.vpm 8.vpm 12.vpm (I haven’t spent much time with these. It appears that the high-order versions transition to growth rather quickly – my guess is that this is an artifact of numerical precision, i.e. any tiny imprecision in the initialization introduces a bit of the growth eigenvector, which quickly swamps the oscillatory signal. It would be interesting to try these in double precision Vensim to see if I’m right.)

Stable initializations: 2stab.vpm 12stab.vpm

A generic version, representing a system as a generic gain matrix, so you can use it to explore any linear unforced variant: Generic.vpm