Recent studies suggest that the type of strategic environment or expectation feedback can have a large impact on whether the market can learn the rational fundamental price. We present an experiment where the fundamental price experiences large unexpected shocks. Markets with negative...

In this paper we investigate the risk-related effects of monetary policy both in normal times, as well as in periods where the zero lower bound (ZLB) binds, in a stylized macroeconomic model with boundedly rational beliefs. In our model, financial market participants use heuristics to assess the...

This paper shows a possible modeling strategy of agents' expectation formation in the agent-based models (ABM). After a brief survey about the introduction of expectation in macroeconomics the work discusses the use of the CEE-SAC learning scheme suggested in Hommes (2013)

In dynamic financial markets the stochastic supply of risky assets has a significant informational role. Contrary to static models, where it acts as “noise,” in dynamic markets stochastic supply contains information about risk premiums. Acquiring private dividend information helps investors...

This paper establishes an agent-based model to describe the dynamic behaviour of the financial market with mutual fund managers and investors under two types of compensation contracts: asset-based fees and performance-based fees, and using two types of adaptive expectation: trend chaser and...