Journal ArticleDOI
Bayesian interactions and collective dynamics of opinion: Herd behavior and mimetic contagion
Reads0
Chats0
TLDR
This model has been designed to study the collective learning process through which a group of interacting agents deals with environmental uncertainty, and it is shown that as soon as the hypothesis of sequentiality is dropped, a large variety of situations can be observed.Abstract:
Much recent work has been devoted to the analysis of herd behavior within sequential decision models. The present article generalizes their results to non-sequential contexts. We will show that, as soon as the hypothesis of sequentiality is dropped, a large variety of situations can be observed. Our model has been designed to study the collective learning process through which a group of interacting agents deals with environmental uncertainty. The crucial question revolves around the relative weight given by each individual to the different sources of information: his private information and his observation of the group opinion.read more
Citations
More filters
Journal ArticleDOI
Mixing beliefs among interacting agents
TL;DR: A model of opinion dynamics in which agents adjust continuous opinions as a result of random binary encounters whenever their difference in opinion is below a given threshold is presented.
Journal ArticleDOI
Volatility clustering in financial markets: a microsimulation of interacting agents
Thomas Lux,Michele Marchesi +1 more
TL;DR: In this paper, both chartist and fundamentalist strategies are considered with agents switching between both behavioural variants according to observed differences in pay-offs. But, the authors do not consider the effect of market makers on price changes.
Journal ArticleDOI
Meet, discuss, and segregate!
TL;DR: A model of opinion dynamics in which agents adjust continuous opinions as a result of random binary encounters whenever their difference in opinion is below a given threshold is presented.
Journal ArticleDOI
Critical market crashes
Didier Sornette,Didier Sornette +1 more
TL;DR: In this paper, the authors present a general theory of financial crashes and stock market instabilities that his co-workers and the author have developed over the past seven years, and demonstrate several detailed mathematical models of speculative bubbles and crashes.
Journal ArticleDOI
Herd behavior and aggregate fluctuations in financial markets
Rama Cont,Jean-Philippe Bouchaud +1 more
TL;DR: In this paper, the authors present a simple model of a stock market where a random communication structure between agents gives rise to a heavy tails in the distribution of stock price variations in the form of an exponentially truncated power-law, similar to distributions observed in recent empirical studies of high frequency market data.
References
More filters
Book
General Theory of Employment, Interest and Money
TL;DR: In this article, a general theory of the rate of interest was proposed, and the subjective and objective factors of the propensity to consume and the multiplier were considered, as well as the psychological and business incentives to invest.
Journal ArticleDOI
The General Theory of Employment, Interest and Money.
Journal ArticleDOI
A Simple Model of Herd Behavior
TL;DR: In this article, the authors analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision, and they show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior.
Posted Content
A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades
TL;DR: It is argued that localized conformity of behavior and the fragility of mass behaviors can be explained by informational cascades.
Journal ArticleDOI
A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades
TL;DR: In this paper, the authors argue that localized conformity of behavior and the fragility of mass behaviors can be explained by informational cascades, where an individual, having observed the actions of those ahead of him, to follow the behavior of the preceding individual without regard to his own information.