Peer-to-peer technology has made massive music piracy possible, which, in turn, has arguably had a significant economic impact on the recording industry. Record labels have responded to online piracy with litigation and are also considering self-help measures. It is currently not obvious whether...

The growth of unsolicited commercial email imposes increasing costs on organizations and causes considerable aggravation on the part of email recipients. A thriving anti-spam industry addresses some of the frustration. Regulation and various economic and technical means are in the works –...

We develop an explanation of the emergence of local norms, and the associated phenom- enon of geographical variation in behavior. Individuals are assumed to interact locally with neighbors in an environment with a network externality. Although many patterns of behavior are possible, the...

We apply agent based computer techniques to develop a modeling framework that can be used to study all aspects of commodity markets. The goal is to use advances in computation to study the micro level behavior of the market and its players. This work is motivated by the understanding that the...

Consider a simple world populated with two kinds of individuals, those who work and create wealth (peasants) and those who survive by taking the property of others (bandits). The presence of bandits creates an incentive for peasants to seek protection, to defend their property. But protection is...

We have developed an agent-based computational model, extension of an analytical model1 that studies the structure of coalitions of B-to-C web sites, when Internet buyers incur search costs for finding the good that matches their preferences, and coalitions of sites reduce this cost through...

While under recursive least squares learning the dynamics of the economy converges to rational expectations equilibria (REE) which are E–stable, some recent examples propose that E–stability is not a sufficient condition for learnability. In this paper, we provide some further...

We examine optimal policy in an open-economy model with uncertainty and learning, where monetary policy actions affect the economy through the real exchange rate channel. Our results show that the degree of caution or activism in optimal policy depends on whether central banks are in coordinated...

We provide sufficient conditions and necessary conditions for stability of an economy under structural mixed recursive least squares/stochastic gradient heterogeneous learning of agents with possibly different degrees of inertia. We have found a unifying condition which is sufficient for...

In this paper we perform an in—depth investigation of relative merits of two adaptive learning algorithms with constant gain, Recursive Least Squares (RLS) and Stochastic Gradient (SG), using the Phelps model of monetary policy as a testing ground. The behavior of the two learning...