The Instability of Markets
adap-org
2019-08-15 v1 Adaptation and Self-Organizing Systems
Abstract
Recent developments in the global liberalization of equity and currency markets, coupled to advances in trading technologies, are making markets increasingly interdependent. This increased fluidity raises questions about the stability of the international financial system. In this paper, we show that as couplings between stable markets grow, the likelihood of instabilities is increased, leading to a loss of general equilibrium as the system becomes increasingly large and diverse.
Keywords
Cite
@article{arxiv.adap-org/9507002,
title = {The Instability of Markets},
author = {Tad Hogg and Bernardo A. Huberman and Michael Youssefmir},
journal= {arXiv preprint arXiv:adap-org/9507002},
year = {2019}
}
Comments
14 pages, self-unpacking