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A Behavioral Model for Participation Games with Negative Feedback
Dindo, Pietro; Tuinstra, Jan - Tinbergen Institute - 2006
We study participation games with negative feedback, i.e. games where players choose either to participate in a certain project or not and where the payoff for participating decreases in the number of participating players. We use the replicator dynamics to model the competition between...
Persistent link: https://www.econbiz.de/10005209448
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More Hedging Instruments may destablize Markets
Brock, William; Hommes, Cars; Wagener, Florian - Tinbergen Institute - 2006
This paper formalizes the idea that more hedging instruments may destabilize markets when traders are heterogeneous and adapt their behavior according to experience based reinforcement learning. We investigate three different economic settings, a simple mean-variance asset pricing model, a...
Persistent link: https://www.econbiz.de/10005795568
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Consistent Estimation of Structural Parameters in Regression Models with Adaptive Learning
Christopeit, Norbert; Massmann, Michael - Tinbergen Institute - 2010
In this paper we consider regression models with forecast feedback. Agents' expectations are formed via the recursive estimation of the parameters in an auxiliary model. The learning scheme employed by the agents belongs to the class of stochastic approximation algorithms whose gain sequence is...
Persistent link: https://www.econbiz.de/10008484069
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A Dynamic Analysis of Moving Average Rules
Chiarella, Carl; He, Tony; Hommes, Cars H. - Tinbergen Institute - 2005
The use of various moving average (MA) rules remains popular with financial market practitioners. These rules have recently become the focus of a number empirical studies, but there have been very few studies of financial market models where some agents employ technical trading rules of the type...
Persistent link: https://www.econbiz.de/10005136922
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Vanity in Politics: A Problem?
Suurmond, Guido; Swank, Otto H.; Visser, Bauke - Tinbergen Institute - 2002
Can vanity do any good? It may seem obvious to answer this question in the negative, as economists have shown how reputational concerns lead agents e.g. to ignore valuable information, to herd, and to become overly risk averse. We explore how proud agents may be a social blessing. An agent may...
Persistent link: https://www.econbiz.de/10005450753
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Interest Rate Rules and Macroeconomic Stability under Heterogeneous Expectations
Anufriev, Mikhail; Assenza, Tiziana; Hommes, Cars; … - Tinbergen Institute
and Hommes (1997). The stabilizing effect of different monetary policies depends on the ecology of forecasting rules, on … agents' sensitivity to differences in forecasting performance and on how aggressively the monetary authority sets the nominal …, expectations rule is part of the ecology of forecasting strategies. …
Persistent link: https://www.econbiz.de/10005016263
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Competitive Prices as Profit-Maximizing Cartel Prices
Houba, Harold; Motchenkova, Evgenia; Wen, Quan - Tinbergen Institute - 2010
Even under antitrust enforcement, firms may still form a cartel in an infinitely-repeated oligopoly model when the discount factor is sufficiently close to one. We present a linear oligopoly model where the profit-maximizing cartel price converges to the competitive equilibrium price as the...
Persistent link: https://www.econbiz.de/10008838625
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The Role and Evolution of Central Authorities
Frijters, Paul; Tieman, Alexander F. - Tinbergen Institute - 1999
In this paper we argue that authorities aid cooperation by means of direct coordination or the enforcement of re-commitment devices such as contract laws.Credible threats of violence allow this role. In a local interaction model, an authority forms if mutually connected individuals with...
Persistent link: https://www.econbiz.de/10005136860
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The Conception of the Individual in Non-Cooperative Game Theory
Davis, John B. - Tinbergen Institute - 2003
This paper examines the conception of individuals as being of certain types in Harsanyi's transformation of games of incomplete information into games of complete information. It argues that while the conception of the individual in games of complete information offers potential advances over...
Persistent link: https://www.econbiz.de/10005144523
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Measuring Power And Satisfaction in Societies with Opinion Leaders: Dictator and Opinion Leader Properties
Brink, René van den; Rusinowska, Agnieszka; Steffen, Frank - Tinbergen Institute - 2009
A well known and established model in communication policy in sociology and marketing is that of opinion leadership. Opinion leaders are actors in a society who are able to affect the behavior of other members called followers. Hence, opinion leaders might have a considerable impact on the...
Persistent link: https://www.econbiz.de/10005036248