Related papers: Why free markets die: An evolutionary perspective

A dynamical model is introduced for the formation of a bullish or bearish trends driving an asset price in a given market. Initially, each agent decides to buy or sell according to its personal opinion, which results from the combination of…

Many complex systems are characterized by broad distributions capturing, for example, the size of firms, the population of cities or the degree distribution of complex networks. Typically this feature is explained by means of a preferential…

The "social-networking revolution" of late (e.g., with the advent of social media, Facebook, and the like) has been propelling the crusade to elucidate the embedded networks that underlie economic activity. An unexampled synthesis of…

Many complex adaptive systems contain a large diversity of specialized components. The specialization at the level of the microscopic degrees of freedom, and diversity at the level of the system as a whole are phenomena that appear during…

Scale independence is a ubiquitous feature of complex systems which implies a highly skewed distribution of resources with no characteristic scale. Research has long focused on why systems as varied as protein networks, evolution and stock…

We present analytic and numerical results for two models, namely the minority model and the bar-attendance model, which offer simple paradigms for a competitive marketplace. Both models feature heterogeneous agents with bounded rationality…

We present a broad agenda for meaningful banking regulation reform aiming the creation of evolutive competitive environment to maximize the effectiveness of international financial system through the introduction of fair competition process…

We propose a simple model that describes the dynamics of efficiencies of competing agents. Agents communicate leading to increase of efficiencies of underachievers, and an efficiency of each agent can increase or decrease irrespectively of…

Several tiers of social organization with varying economic and social disparities have been observed. However, a quantitative characterization of the types and the causal mechanisms for the transitions have hardly been explained. While…

Why are human societies unstable? Theories based on the observation of recurring patterns in historical data indicate that economic inequality, as well as social factors are key drivers. So far, models of this phenomenon are more…

Institutions and cultures evolve adaptively in response to the current environmental incentives, usually. But sometimes institutional change is due to stochastic drives beyond current fitness, including drift, path dependency, blind…

I study the limit of a large random economy, where a set of consumers invests in financial instruments engineered by banks, in order to optimize their future consumption. This exercise shows that, even in the ideal case of perfect…

Individuals in free societies frequently exhibit striking coordination when making independent decisions en masse. Examples include the regular appearance of hit products or memes with substantially higher popularity compared to their…

An open market is a subset of an entire equity market composed of a certain fixed number of top capitalization stocks. Though the number of stocks in the open market is fixed, the constituents of the market change over time as each…

The decision process requires information about the present state of the system, but in economy acquiring data and processing them is an expensive and time consuming process. Therefore the state of the system is measured and announced at…

The evolution of galaxies is driven strongly by dynamical processes including internal instabilities, tidal interactions and mergers. The cluster environment is a useful laboratory for studying these effects. I present recent results on…

I show that firms price almost competitively and consumers can infer product quality from prices in markets where firms differ in quality and production cost, and learning prices is costly. Bankruptcy risk or regulation links higher quality…

We show that evolution in a population of adaptive agents, repeatedly competing for a limited resource, can come to an abrupt halt. This transition from evolutionary to non-evolutionary behavior arises as the global resource level is…

In speculative markets, risk-free profit opportunities are eliminated by traders exploiting them. Markets are therefore often described as "informationally efficient", rapidly removing predictable price changes, and leaving only residual…

This paper is based on the premise that economic growth is driven by an interplay between innovation and imitation in an economy composed of interacting firms operating in a stochastic environment. A novel approach to modeling imitation is…