100+ empirically calibrated coupling rules enforce causal economic coherence across every simulation path. Each rule has a trigger condition, a structural rationale, and an academic citation.
Coupling rules are the backbone of WorldSim's structural realism. They prevent economically impossible trajectories by enforcing known causal relationships between macroeconomic, fiscal, demographic, and social indicators, calibrated against decades of empirical research.
6 rules governing GDP, unemployment, and inflation interactions
When GDP per capita growth is strongly above trend, unemployment tends to fall (Okun-style coupling).
If GDP per capita YoY growth ≥ +2.0pp above its 5y moving average for 2 consecutive years.
Sustained negative GDP per capita growth increases unemployment and depresses GDP distribution (Okun-style downturn coupling).
If GDP per capita YoY growth ≤ -1.5pp for 2 consecutive years.
Tight labor market with low inflation can support higher GDP growth, with mild inflation pressure later.
If unemployment ≤ (its 10y median - 0.8σ) AND inflation ≤ 2.0% for 2y.
Very low unemployment with already elevated inflation increases inflation further (Phillips curve pressure).
If unemployment ≤ (10y median - 1.0σ) for 2y AND inflation already ≥ 2.5%.
Fast unemployment declines signal tightening labor markets, raising wage/price pressures.
If unemployment declines by ≥ 2.0pp within 2 years.
Sustained unemployment reduction signals improving economic conditions and supports GDP per capita growth.
If unemployment falls by ≥ 1.5pp within 2 years.
6 rules governing debt dynamics, government spending, and tax structure
Very high public debt sustained over time depresses growth and raises labor-market slack.
If public_debt ≥ 120% GDP for 3 consecutive years.
Large spending cuts can depress growth and raise unemployment in the short run.
If government expenditure drops by ≥ 3pp within 2 years.
Very high tax wedge sustained over time raises unemployment.
If tax_wedge ≥ 42% for 3 consecutive years.
Persistent large deficits raise debt dynamics and can add mild inflation pressure.
If government expenditure increases by ≥ 2pp AND revenue does not increase over same period.
When growth stalls, countercyclical spending can temporarily lift output but raises debt.
If GDP growth ≤ 0% for 1y AND government expenditure increases by ≥ 2pp.
High inflation alongside high debt can increase debt dynamics uncertainty.
If inflation ≥ 5% AND public_debt ≥ 90% GDP for 2y.
4 rules governing interest rate transmission and monetary shocks
If inflation remains elevated for multiple years, monetary tightening reduces growth with a lag.
If inflation ≥ 4.0% for 2 consecutive years.
Sustained policy rate increase of 1.5+ percentage points signals a meaningful tightening cycle.
If interest rate rises by ≥ 1.5pp over 2 years.
Sustained policy rate cut stimulates demand; GDP and employment improve but housing re-inflates.
If interest rate falls by ≥ 1.5pp over 2 years.
Emergency rate hike of 3+ percentage points causes acute economic contraction.
If interest rate rises by ≥ 3.0pp in 1 year.
4 rules governing rent pass-through, affordability, and migration-driven demand
High rent inflation passes through to headline inflation.
If rent index YoY growth ≥ +6% for 2 consecutive years.
Persistent rent-to-income deterioration reduces in-migration and fertility over time.
If rent index growth exceeds GDP per capita growth by ≥ 3pp for 3y.
High inflation combined with stretched affordability increases stress, raises unemployment and corrects prices.
If inflation ≥ 4% for 2y AND price_to_income ≥ (median + 1.0σ).
High net migration increases housing demand, raising rents and price-to-rent ratios.
If net migration ≥ +5 per 1000 for 2y.
5 rules governing energy security, electricity pricing, and fuel cost transmission
High energy self-sufficiency reduces inflation pass-through and stabilizes electricity prices.
If energy_self_sufficiency ≥ 70% for 3y.
Low energy self-sufficiency increases exposure to external price shocks.
If energy_self_sufficiency ≤ 30% for 3y.
Household electricity prices above $0.35/kWh for 2 years suppresses GDP and raises inflation.
If electricity_price > $0.35/kWh for 2 consecutive years.
When electricity prices rise sharply or remain high, competitiveness deteriorates.
If electricity prices rise by ≥ $0.05/kWh within 2y OR remain ≥ $0.35/kWh for 2y.
Sustained fuel price increases feed into transport, logistics, heating, and food costs.
If petrol price rises ≥ 15% YoY for 1 year.
5 rules governing ageing, fertility, brain drain, and migration dynamics
Population ageing reduces productivity growth; labor force shrinkage can lower unemployment.
If population 65+ ≥ 25% for 5y.
Sustained low fertility accelerates ageing; a policy response proxy is higher net migration.
If total fertility rate ≤ 1.4 for 5y.
Sustained positive net migration expands the labor force and supports economic growth.
If net migration ≥ +3 per 1000 for 3 consecutive years.
Fertility below 1.3 for 3 years signals collapsing future labour force and tax base.
If total fertility rate < 1.3 for 3 consecutive years.
Persistent negative net migration depletes the educated working-age population.
If net migration ≤ -2.0 per 1000 for 3 consecutive years.
4 rules governing innovation, digital divides, and AI displacement dynamics
Sustained R&D above 2.5% GDP drives endogenous productivity growth through innovation.
If R&D expenditure ≥ 2.5% GDP for 3 consecutive years.
Internet penetration below 60% prevents digital network effects.
If internet users < 60% for 3 consecutive years.
High AI exposure without R&D means workers are displaced but no new tasks are created.
If AI exposure ≥ 30% AND R&D < 1% GDP for 3 consecutive years.
AI exposure with low internet penetration concentrates automation benefits among connected elites.
If AI exposure ≥ 20% AND internet users < 75% for 3 consecutive years.
13 rules modelling extreme tail scenarios: recessions, crises, pandemics, and systemic shocks
Broad recession dynamics: output contraction, labor market deterioration, disinflation.
If GDP YoY ≤ -2.0pp for 2y AND unemployment rises ≥ +2.0pp.
Housing overvaluation plus labor deterioration forces correction and macro stress.
If housing overvaluation (price_to_rent or price_to_income ≥ median+2σ) AND unemployment rises ≥ +1.5pp.
High debt and high inflation jointly raise instability and depress activity.
If public_debt ≥ 140% GDP for 2y AND inflation ≥ 5% for 2y.
Supply disruption when import dependence is extreme and electricity prices spike.
If energy self-sufficiency ≤ 25% AND electricity price YoY increases ≥ 25%.
One-year inflation spike paired with growth drop: commodity shock proxy.
If inflation jumps by ≥ +3pp in 1 year AND GDP declines ≥ 3% YoY.
Severe housing downturn: large affordability correction plus labor deterioration.
If price_to_income decreases by ≥ 20% within 3y AND unemployment increases ≥ +2pp.
High-inflation regime where expectations de-anchor: large inflation shift and GDP damage.
If inflation ≥ 10% for 2 consecutive years.
Large GDP drop with rapid fiscal expansion: pandemic-like demand shock proxy.
If GDP drops by ≥ -3% YoY in one year AND government expenditure jumps by ≥ +3pp.
Conflict proxy driven by migration surge and inflation pressure.
If net migration increases by ≥ +10 per 1000 within 2y AND inflation ≥ 4%.
Extreme crime plus macro distress drives emigration and hits output.
If crime ≥ median+2σ AND (inflation ≥ 6% OR unemployment ≥ 12%) for 2y.
Extreme inflow year: raises housing pressure and public spending.
If net migration ≥ +15 per 1000 for 1 year.
Large electricity price drop: disinflationary windfall and activity boost.
If electricity price decreases by ≥ 25% YoY.
Extreme renewable buildout (≥ 20pp share rise) triggers electricity price spikes and deindustrialisation risk.
If renewable energy share increases by ≥ 20pp within 5 years.
Run a simulation and watch how coupling rules activate across your chosen scenario path. Every rule fires conditionally, producing structurally coherent futures grounded in academic research.