Related papers: Rational Bubbles: A Clarification
Bitcoin represents one of the most interesting technological breakthroughs and socio-economic experiments of the last decades. In this paper, we examine the role of speculative bubbles in the process of Bitcoin's technological adoption by…
We document and analyze the empirical facts concerning one of the clearest evidence of speculation in financial trading as observed in the postage collection stamp market. We unravel some of the mechanisms of speculative behavior which…
The financial crisis of 2008, which started with an initially well-defined epicenter focused on mortgage backed securities (MBS), has been cascading into a global economic recession, whose increasing severity and uncertain duration has led…
The authors review results implicit in their recent paper [2] on the product/quotient representation of rationals by rationals of the type $( an + b )/ ( An+ B )$ and give a detailed account of a particular related non-intuitive…
A taxonomy of large financial crashes proposed in the literature locates the burst of speculative bubbles due to endogenous causes in the framework of extreme stock market crashes, defined as falls of market prices that are outlier with…
Proving the existence of speculative financial bubbles even a posteriori has proven exceedingly difficult so anticipating a speculative bubble ex ante would at first seem an impossible task. Still as illustrated by the recent turmoil in…
Statisticians have warned us since the early days of their discipline that experimental correlation between two observations by no means implies the existence of a causal relation. The question about what clues exist in observational data…
The price-bubble and crash process formation is theoretically investigated in a two-asset equilibrium model. Sufficient and necessary conditions are derived for the existence of average equilibrium price dynamics of different agent-based…
We propose new definitions of (causal) explanation, using structural equations to model counterfactuals. The definition is based on the notion of actual cause, as defined and motivated in a companion paper. Essentially, an explanation is a…
We present the logical induction criterion for computable algorithms that assign probabilities to every logical statement in a given formal language, and refine those probabilities over time. The criterion is motivated by a series of stock…
Let X be a complex, rationally connected, projective manifold. We show that X admits a modification X' that contains a quasi-line, ie a smooth rational curve whose normal bundle is a direct sum of copies of O_{P^1}(1). For manifolds…
Cognitive theories for reasoning are about understanding how humans come to conclusions from a set of premises. Starting from hypothetical thoughts, we are interested which are the implications behind basic everyday language and how do we…
Pertaining to Agent-based Computational Economics (ACE), this work presents two models for the rise and downfall of speculative bubbles through an exchange price fixing based on double auction mechanisms. The first model is based on a…
The concept of absence of opportunities for free lunches is one of the pillars in the economic theory of financial markets. This natural assumption has proved very fruitful and has lead to great mathematical, as well as economical, insights…
Neural rationale models are popular for interpretable predictions of NLP tasks. In these, a selector extracts segments of the input text, called rationales, and passes these segments to a classifier for prediction. Since the rationale is…
We introduce a model of super-exponential financial bubbles with two assets (risky and risk-free), in which rational investors and noise traders co-exist. Rational investors form expectations on the return and risk of a risky asset and…
Given a proper, rational map of balls, D'Angelo and Xiao introduced five natural groups encoding properties of the map. We study these groups using a recently discovered normal form for rational maps of balls. Using this normal form, we…
Defeasible statements are statements that are likely, or probable, or usually true, but may occasionally be false. Plausible reasoning makes conclusions from statements that are either facts or defeasible statements without using numbers.…
The dominant theories of rational choice assume logical omniscience. That is, they assume that when facing a decision problem, an agent can perform all relevant computations and determine the truth value of all relevant logical/mathematical…
We defend a new theory of statistical evidence, which we call Robust Bayesianism (RB). We prove that, under widely accepted assumptions, RB entails the law of likelihood [Royall, 1997], the likelihood principle [Berger and Wolpert, 1988],…