We propose a mechanism based on taxes and subsidies that enhances high cooperation in evolutionary networks. The interactions among agents are based on a Prisoners' Dilemma game in which each agent plays the same strategy with its local neighbors, collects an aggregate payoff and imitates the...

Models based on agents has been widely used to study the paradigmatic emergence of cooperation in social systems. In the Spatial Prisoners' Dilemma game introduced by Martin Nowak and Robert May, the agents are greedy and imitate indiscriminately the action of the wealthiest neighbor. Other...

Base rate neglect has been shown to be a very robust bias in human information processing. It has also been show to be ecologically rational in some environments. However, when arguing about base rate neglect usually isolated individuals are considered. I complement these results by showing that...

This paper examines the implications of a 'strong' version of bounded rationality popular within computational and evolutionary game theory in which agents are represented by finite automata. It is argued that this view has unrealistic features in that agents of this kind are unable to...

Despite a large literature documenting that the efficacy of monetary policy depends on how inflation expectations are anchored, many monetary policy models assume: (1) the inflation target of moentary policy is constant; and, (2) the inflation target is known by all economic agents. This paper...

For many environmental problems regulators are uncertain about both the costs of abatement and the stock-related damages. For example, governments have imperfect information about damages caused by greenhouse gas stocks, and also about the costs of abating greenhouse gas emissions. They acquire...

In this paper, we propose use of the influence diagram for stock portfolio selection. We use an algorithm that applies the mutual information as the metric to guide the refinement of the influence diagram. We applied the algorithm to the conceptual refinement of the influence diagram. We tested...