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Heterogeneous Agent Models in Economics and Finance

Hommes, Cars H. - Tinbergen Instituut - 2005

This paper surveys work on dynamic heterogeneous agent models (HAMs) in economics and finance. Emphasis is given to simple models that, at least to some extent, are tractable by analytic methods in combination with computational tools. Most of these models are behavioral models with boundedly...

Persistent link: https://www.econbiz.de/10011255802

Heterogeneous Agent Models: Two Simple Case Studies

Hommes, Cars - Tinbergen Instituut - 2005

These notes review two simple heterogeneous agent models in economics and finance. The first is a cobweb model with rational versus naive agents introduced in Brock and Hommes (1997). The second is an asset pricing model with fundamentalists versus technical traders introduced in Brock and...

Persistent link: https://www.econbiz.de/10011256250

Stochastic Orders of Proposing Players in Bargaining

Houba, Harold - Tinbergen Instituut - 2005

The bargaining model with stochastic order of proposing players is properly embedded in continuous time and it is … the Nash bargaining solution of a modified bargaining problem and the Maximum Theorem implies convergence to the Nash … bargaining solution when time between proposals vanishes. The model unifies alternating offers, one-sided offers and random …

Persistent link: https://www.econbiz.de/10011255513

Costless Delay in Negotiations

Herings, P. Jean-Jacques; Houba, Harold - Tinbergen Instituut - 2015

We study strategic negotiation models featuring costless delay, general recognition procedures, endogenous voting orders, and finite sets of alternatives. Two examples show: 1. non-existence of stationary subgame-perfect equilibrium (SSPE). 2. the recursive equations and optimality conditions...

Persistent link: https://www.econbiz.de/10011255692

The Condorcet Paradox Revisited

Herings, P. Jean-Jacques; Houba, Harold - Tinbergen Instituut - 2010

We analyze the simplest Condorcet cycle with three players and three alternatives within a strategic bargaining model …

Persistent link: https://www.econbiz.de/10011255823

Alternating Offers in Economic Environments

Houba, Harold - Tinbergen Instituut

bargaining solution of a modified bargaining problem in the contract space yields the pair of stationary subgame perfect … the Nash bargaining solution is immediate by the Maximum Theorem. Numerical implementation in standard optimization …

Persistent link: https://www.econbiz.de/10011256390

On the Strategic Use of Focal Points in Bargaining Situations

Janssen, Maarten C.W. - Tinbergen Instituut - 2006

This paper argues that the notion of focal points is important in understanding bargaining processes. Recent literature … confines a discussion of the usefulness of the notion to coordination problems and when bargaining experiments result in … equal split division and it re-interprets recent experimental evidence in bargaining games. Experimental economists should …

Persistent link: https://www.econbiz.de/10011256649

Preopening and Equilibrium Selection

Calcagno, Riccardo; Lovo, Stefano - Tinbergen Instituut - 2010

We introduce a form of pre-play communication that we call "preopening". During the preopening, players announce their tentative actions to be played in the underlying game. Announcements are made using a posting system which is subject to stochastic failures. Posted actions are publicly...

Persistent link: https://www.econbiz.de/10011257235

Perfect Equilibria in a Negotiation Model with Different Time Preferences

Houba, Harold; Wen, Quan - Tinbergen Instituut - 2006

bargaining frontier. However, when players have different time preferences, intertemporal trade may lead to continuation payoffs … above the bargaining frontier. We provide a thorough study of this problem without imposing the conventional assumption. Our …

Persistent link: https://www.econbiz.de/10011257339

Extreme Equilibria in a General Negotiation Model

Houba, Harold; Wen, Quan - Tinbergen Instituut - 2007

</I> (2011), Vol. 73, pp.507–516.<P> We study a bargaining model with a disagreement game between offers and counteroffers. In …

Persistent link: https://www.econbiz.de/10011257375