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We study the collective dynamics of a lattice model of stochastically interacting agents with a weighted field of vision. We assume that agents preferentially interact with neighbours, depending on their relative location, through velocity…

Statistical Mechanics · Physics 2024-06-11 Shakti N. Menon , Trilochan Bagarti , Abhijit Chakraborty

In the information-based approach to asset pricing the market filtration is modelled explicitly as a superposition of signals concerning relevant market factors and independent noise. The rate at which the signal is revealed to the market…

Pricing of Securities · Quantitative Finance 2010-09-21 Dorje C. Brody , Yan Tai Law

The paper gives picture of enrichment to economic and financial system analysis using agent-based models as a form of advanced study for financial economic data post-statistical-data analysis and micro-simulation analysis. Theoretical…

Adaptation and Self-Organizing Systems · Physics 2008-12-02 Hokky Situngkir , Yohanes Surya

When society maintains a competitive system to promote an abstract goal, competition by necessity relies on imperfect proxy measures. For instance profit is used to measure value to consumers, patient volumes to measure hospital…

Physics and Society · Physics 2019-10-03 Oliver Braganza

In this paper we analyze the rural-urban migration phenomena as it is usually observed in economies which are in the early stages of industrialization. The analysis is conducted by means of a statistical mechanics approach which builds a…

Computational Physics · Physics 2009-11-11 Jaylson J. Silveira , Aquino L. Espindola , T. J. P. Penna

We define and study a rather complex market model, inspired from the Santa Fe artificial market and the Minority Game. Agents have different strategies among which they can choose, according to their relative profitability, with the…

Condensed Matter · Physics 2009-11-07 Irene Giardina , Jean-Philippe Bouchaud

We introduce a lattice model for a static and isotropic system of relativistic fermions. An action principle is formulated, which describes a particle-particle interaction of all fermions. The model is designed specifically for a numerical…

Mathematical Physics · Physics 2014-11-18 Felix Finster , Wätzold Plaum

In this work the system of agents is applied to establish a model of the nonlinear distributed signal processing. The evolution of the system of the agents - by the prediction time scale diversified trend followers, has been studied for the…

Statistical Finance · Quantitative Finance 2011-10-13 Tomáš Tokár , Denis Horváth , Michal Hnatich

In this research, the tax evasion percentage, as order parameter, of a system of individuals or agents inscribed in a $N = L \times L$ 2D square grid is computed. The influence of local environment over each agent is quantified both through…

Physics and Society · Physics 2021-08-18 Julian Giraldo-Barreto , J. Restrepo

Macroscopic price evolution models are commonly used for investment strategies. There are first promising achievements in defining microscopic agent based models for the same purpose. Microscopic models allow a deeper understanding of…

Pricing of Securities · Quantitative Finance 2011-03-29 Sebastian M. Krause , Stefan Bornholdt

Based on criteria of mathematical simplicity and consistency with empirical market data, a model with volatility driven by fractional noise has been constructed which provides a fairly accurate mathematical parametrization of the data.…

Statistical Finance · Quantitative Finance 2010-08-31 R. Vilela Mendes

We present a novel model for capturing the behavior of an agent exhibiting sunk-cost bias in a stochastic environment. Agents exhibiting sunk-cost bias take into account the effort they have already spent on an endeavor when they evaluate…

Computer Science and Game Theory · Computer Science 2021-06-22 Jon Kleinberg , Sigal Oren , Manish Raghavan , Nadav Sklar

This paper develops a dynamic internal fraud model for operational losses in retail banking. It considers public operational losses arising from internal fraud in retail banking within a group of international banks. Additionally, the model…

Risk Management · Quantitative Finance 2020-02-11 Rocío Paredes , Marco Vega

Strategic argumentation provides a simple model of disputation and negotiation among agents. Although agents might be expected to act in our best interests, there is little that enforces such behaviour. (Maher, 2016) introduced a model of…

Artificial Intelligence · Computer Science 2020-09-01 Michael J. Maher

The use of factor stochastic volatility models requires choosing the number of latent factors used to describe the dynamics of the financial returns process; however, empirical evidence suggests that the number and makeup of pertinent…

Applications · Statistics 2019-03-06 Taylor R. Brown

Consider a typical organization whose worker agents seek to collectively cooperate for its general betterment. However, each individual agent simultaneously seeks to act to secure a larger chunk than its co-workers of the annual increment…

Machine Learning · Computer Science 2020-10-19 Keyang He , Bikramjit Banerjee , Prashant Doshi

We model a network economy with three sectors: downstream firms, upstream firms, and banks. Agents are linked by productive and credit relationships so that the behavior of one agent influences the behavior of the others through network…

General Finance · Quantitative Finance 2010-06-18 Domenico Delli Gatti , Mauro Gallegati , Bruce Greenwald , Alberto Russo , Joseph E. Stiglitz

A microscopic approach to macroeconomic features is intended. A model for macroeconomic behavior under heterogeneous spatial economic conditions is reviewed. A birth-death lattice gas model taking into account the influence of an economic…

Statistical Mechanics · Physics 2009-11-10 Marcel Ausloos , Paulette Clippe , Janusz Miśkiewicz , Andrzej Pekalski

Complex networked systems can be modeled and represented as graphs, with nodes representing the agents and the links describing the dynamic coupling between them. The fundamental objective of network identification for dynamic systems is to…

Systems and Control · Electrical Eng. & Systems 2020-06-09 Venkat Ram Subramanian , Andrew Lamperski , Murti V. Salapaka

In this short paper we define the wealth process in a spin model for market microstructure, for individual agents and in aggregate. The agents in our model try to balance their desire to belong to the local majority (herding behavior),…

Probability · Mathematics 2008-12-02 Ted Theodosopoulos , Ming Yuen