Related papers: May's Instability in Large Economies
Economy is demanding new models, able to understand and predict the evolution of markets. To this respect, Econophysics is offering models of markets as complex systems, such as the gas-like model, able to predict money distributions…
Power law distributions of macroscopic observables are ubiquitous in both the natural and social sciences. They are indicative of correlated, cooperative phenomena between groups of interacting agents at the microscopic level. In this paper…
The stability analysis of socioeconomic systems has been centered on answering whether small perturbations when a system is in a given quantitative state will push the system permanently to a different quantitative state. However, typically…
In multi-agent environments in which coordination is desirable, the history of play often causes lock-in at sub-optimal outcomes. Notoriously, technologies with a significant environmental footprint or high social cost persist despite the…
We develop a tractable macroeconomic model that captures dynamic behaviors across multiple timescales, including business cycles. The model is anchored in a dynamic capital demand framework reflecting an interactions-based process whereby…
Spatial distribution of the human population is distinctly heterogeneous, e.g. showing significant difference in the population density between urban and rural areas. In the historical perspective, i.e. on the timescale of centuries, the…
This paper suggests that business cycles may be a manifestation of coupled real economy and stock market dynamics and describes a mechanism that can generate economic fluctuations consistent with observed business cycles. To this end, we…
An interbank market lets participants pool the risk arising from the combination of illiquid investments and random withdrawals by depositors. But it also creates the potential for one bank's failure to trigger off avalanches of further…
In Hopenhayn's (1992) entry-exit model productivity is bounded, implying that the predicted firm size distribution cannot match the power law tail observable in the data. In this paper we remove the boundedness assumption and, in this more…
The behavior of the network and its stability are governed by both dynamics of individual nodes as well as their topological interconnections. Attention mechanism as an integral part of neural network models was initially designed for…
In natural ecosystems, species can be characterized by the nonlinear density-dependent self-regulation of their growth profile. Species of many taxa show a substantial density-dependent reduction for low population size. Nevertheless, many…
Virtually anything can be and is ranked; people, institutions, countries, words, genes. Rankings reduce complex systems to ordered lists, reflecting the ability of their elements to perform relevant functions, and are being used from…
Understanding the relationship between complexity and stability in large dynamical systems -- such as ecosystems -- remains a key open question in complexity theory which has inspired a rich body of work developed over more than fifty…
Standard macroeconomic models assume that households are rational in the sense that they are perfect utility maximizers, and explain economic dynamics in terms of shocks that drive the economy away from the stead-state. Here we build on a…
A central feature of complex systems is the relevance and entanglement of different levels of description. For instance, the dynamics of ecosystems can be alternatively described in terms of large ecological processes and classes of…
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…
Martensites subjected to quasistatic deformation are known to exhibit power law distributed acoustic emission in a broad range of scales, however, the origin of the observed scaling behavior and the mechanism of self-organization towards…
Functions or 'functionings' enable to give a structure to any activity and their combinations constitute the capabilities which characterize economic assets such as work utility. The basic law of supply and demand naturally emerges from…
A dynamic model of the social relations between workers and capitalists is introduced. The model is deduced from the assumption that the law of value is an organising principle of modern economies. The model self-organises into a dynamic…
Social ecological systems are often difficult to investigate and manage because of their inherent complexity1. Small variations in external drivers can lead to abrupt changes associated with instabilities and bifurcations in the underlying…