This short paper argues that rationally motivated coordination between agents is an important ingredient to understand the current economic crisis. We argue that changes in parameters that model the structure of a macro-economy or financial markets are not exogenous but arise as agents adopt...

We show that a class of microeconomic behavioral models with interacting agents, introduced by Kirman (1991, 1993), can replicate the empirical long-memory properties of the two first conditional moments of financial time series. The essence of these models is that the forecasts and thus the...

This paper offers an explanation of behavior that puzzled entomologists and economists. Ants, faced with two identical food sources, were observed to concentrate more on one of these but, after a period, they would turn their attention to the other. The same phenomenon has been observed in...