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Does the field of economics use simulations like this at scale?

It seems valuable to simulate all international trade, asset markets, supply and demand, employment, etc. to make predictions. It could also lead to better ideas to prevent or quell recessions by focusing attention on the correct levers.

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Yes and this is exactly what the fed and governmental agencies attempt to model. Modeling such systems is very naive, but so is some cult-like belief in some first principles taught in Econ 101.

I have to wonder about the real-world applicability of any such simulation, under the assumption that the systems in question are chaotic, and so extremely sensitive to initial conditions.

Do we end up needing to simulate the whole world? Because, ultimately these systems are in fact one, and not separate at all.

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