Game-theoretic models are a convenient tool to systematically analyze competitive situations. This makes them particularly handy in the field of security where a company or a critical infrastructure wants to defend against an attacker. When the optimal solution of the security game involves...

Interacting agents in finance represent a behavioral, agent-based approach in which financial markets are viewed as complex adaptive systems consisting of many boundedly rational agents interacting through simple heterogeneous investment strategies, constantly adapting their behavior in response...

Introducing bounded rationality into a standard consumption based asset pricing model with a representative agent and time separable preferences strongly improves empirical performance. Learning causes momentum and mean reversion of returns and thereby excess volatility, persistence of...