Local Environment Analysis and Rules Inferring Procedure in an Agent-Based Model – Applications in Economics
AbstractThe use of agent-based modeling in economics is a step forward enabling a more realistic description of the complex interactions and behaviors occurring in the economic environment. Although it offers increased realism, especially in describing how local characteristics generate global patterns, it suffers from a simplistic approach to modeling local behaviors and rules. From this perspective the paper suggests possible solutions in two directions. First, the paper uses neural networks as an instrument for the agents to scan their local environment and infer possible behaviors. Second, the paper defines and applies an algorithm enabling the agents to understand a subset of rules that are not defined at the beginning of the application. The goal is to see how it is possible to generate new rules with structure and semantics. This would constitute “real” learning, namely defining new rules but not only quantitative variations of the initial rules.
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Bibliographic InfoArticle provided by Institute for Economic Forecasting in its journal Romanian Journal for Economic Forecasting.
Volume (Year): (2012)
Issue (Month): 1 (March)
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More information through EDIRC
agent-based modeling; neural networks; complex rules; algorithms;
Find related papers by JEL classification:
- C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
- E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
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- Stefan Thurner & J. Doyne Farmer & John Geanakoplos, 2010.
"Leverage Causes Fat Tails and Clustered Volatility,"
Cowles Foundation Discussion Papers
1745R, Cowles Foundation for Research in Economics, Yale University, revised Nov 2011.
- Stefan Thurner & J. Doyne Farmer & John Geanakoplos, 2012. "Leverage causes fat tails and clustered volatility," Quantitative Finance, Taylor & Francis Journals, vol. 12(5), pages 695-707, February.
- Stefan Thurner & J. Doyne Farmer & John Geanakoplos, 2009. "Leverage Causes Fat Tails and Clustered Volatility," Papers 0908.1555, arXiv.org, revised Jan 2010.
- Stefan Thurner & J. Doyne Farmer & John Geanakoplos, 2010. "Leverage Causes Fat Tails and Clustered Volatility," Cowles Foundation Discussion Papers 1745, Cowles Foundation for Research in Economics, Yale University.
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