SYSTEM COMPLEXITY AND SCENARIO ANALYSIS

Scenarios are not (deterministic or probabilistic) predictions but explorations either of possible futures (forecasting) or of necessary policies to achieve a future considered as desirable (backcasting). They are usually understood to consist of a narrative illustrated by a computer simulation using parameters derived from the storyline and quantifying (parts of) the scenario. Unfortunately today, predictions, projections, probabilistic forecasts and more are labelled scenarios, while some scenarios like economic growth forecasts are presented as (probabilistic) predictions. A system theory based analysis shows that the way of deriving plausible or predictable futures depends on the kind of system described, which in turn significantly influences the recommendations derived from the scenarios for policy measures to be taken to achieve an externally defined, desired state of the system. For these recommendations to be a solid guidance, it is necessary that the system under analysis (the reality), the mental model used to describe it, e.g. in the narrative (the perceived reality) and the computer model used for the simulation runs (the virtual reality) have a common level of complexity. If not so, a confusio