Generative economic modeling by Hanno Kase, Matthias Rottner and Fabio Stohler published by BIS (12/2025).
Advances in artificial intelligence (AI) offer significant opportunities for economic analysis by pushing the boundaries of modelling capabilities. In particular, deep learning has emerged as a powerful tool for addressing dynamic economic models that were previously deemed intractable. However, effectively applying deep learning in practice often requires meticulous adjustments tailored to the model in question, which can present considerable challenges. In contrast, traditional solution methods are specifically designed and optimised for certain types of economic models but struggle with high-dimensional models. To bridge this gap, we propose a novel approach that combines the strengths of both approaches.