See also here
https://forums.frontier.co.uk/showthread.php?t=6305
The problem with the faction simulations as described in the design archive is that an important component of the design is still missing, for the moment. That component being local Galnet descriptions of the states and pending states, which should give a narrative to what is happening in each system, and describe how players have affected the system, and how they might try to affect its future development. The generic description of 'civil war' in the RHS panel is too generic to be useful. For me, there is also an annoying display bug related to pending states: sometimes it shows them, sometimes there's a blank space.
But the simulation does appear to be working in general, just in ways that are currently inscrutable to players. I have seen economic boom working in a place where you could reasonably expect an economic boom, for example. There is a faction down my way in a civil war state across several systems, but I have yet to see a conflict zone, so there's no obvious way for players to affect its outcome and we can't yet see anything going on inside the black box, which results in a feeling of detachment. This will change I'm sure.
No doubt such a complex system will take time to kick into shape properly, but I'm looking forward to richer player participation in future. Lugh is a worthwhile and interesting test bed. Good work you're doing.