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Was Hayek an Ace?

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  • Nicolaas J. Vriend

    ()
    (Queen Mary and Westfield College, University of London)

Abstract

In order to address the question whether Hayek might have been an Agent-based Computational Economist (ACE) avant-la-lettre, we consider an ACE model concerning the phenomenon of information contagion. Alongside increasing returns, network externalities, and information cascades, information contagion has been presented in the literature as an explanation for particular patterns of macrobehavior that may seem at odds with the underlying micromotives. But whereas these other explanations have been shown to have a proper microfoundation, information contagion has remained a phenomenon that seemed to occur only when certain ad hoc rules of thumb for individual behavior are assumed. We show how information-contagious behavior can emerge in a coevolutionary process of interacting adaptive agents, how this is related to various Hayekian themes, and how ACE research in general is an application of Hayek's methodological insights.

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Bibliographic Info

Paper provided by Queen Mary, University of London, School of Economics and Finance in its series Working Papers with number 403.

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Date of creation: May 1999
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Handle: RePEc:qmw:qmwecw:wp403

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Keywords: Hayek; Agent-based Computational Economics; Decentralized interaction; Distributed knowledge; Reinforcement learning; Information aggregation; Self-organization; Spontaneous order; Methodology;

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Citations

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Cited by:
  1. Kirman, Alan P. & Vriend, Nicolaas J., 2001. "Evolving market structure: An ACE model of price dispersion and loyalty," Journal of Economic Dynamics and Control, Elsevier, vol. 25(3-4), pages 459-502, March.
  2. Fontana, Magda, 2010. "Can neoclassical economics handle complexity? The fallacy of the oil spot dynamic," Journal of Economic Behavior & Organization, Elsevier, vol. 76(3), pages 584-596, December.
  3. Fontana Magda, 2008. "The complexity approach to economics : a Paradigm shift," CESMEP Working Papers 200801, University of Turin.
  4. Chen, Shu-Heng, 2012. "Varieties of agents in agent-based computational economics: A historical and an interdisciplinary perspective," Journal of Economic Dynamics and Control, Elsevier, vol. 36(1), pages 1-25.
  5. Sandye Gloria-Palermo, 2013. "Equilibrium versus Process: A Confrontation between Mainstream and Austrian Ontology," GREDEG Working Papers 2013-39, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.
  6. Jie-Shin Lin, 2005. "Learning in a Network Economy," Computational Economics, Society for Computational Economics, vol. 25(1), pages 59-74, February.
  7. David Chavalarias, 2006. "Metamimetic Games : Modeling Metadynamics in Social Cognition," Post-Print hal-00007743, HAL.
  8. Richard Wagner, 2008. "Finding social dilemma: West of Babel, not east of Eden," Public Choice, Springer, vol. 135(1), pages 55-66, April.
  9. Faggini, Marisa & Parziale, Anna, 2011. "Fitness landscape and tax planning: NK model for fiscal federalism," MPRA Paper 33770, University Library of Munich, Germany.
  10. Buda, Rodolphe, 2001. "Les algorithmes de la modélisation : une analyse critique pour la modélisation économique," MPRA Paper 3926, University Library of Munich, Germany, revised Jul 2004.
  11. Magda Fontana, 2006. "Computer simulations, mathematics and economics," International Review of Economics, Springer, vol. 53(1), pages 96-123, March.
  12. Guinevere Nell, 2010. "Competition as market progress: An Austrian rationale for agent-based modeling," The Review of Austrian Economics, Springer, vol. 23(2), pages 127-145, June.
  13. Sandye Gloria-Palermo, 2013. "In Search of the Right Tool: From Formalism to Constructivist Modelling," GREDEG Working Papers 2013-33, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.
  14. Richard Wallick, 2012. "Agent-based modeling, public choice, and the legacy of Gordon Tullock," Public Choice, Springer, vol. 152(1), pages 223-244, July.
  15. Koppl, Roger, 2010. "Some epistemological implications of economic complexity," Journal of Economic Behavior & Organization, Elsevier, vol. 76(3), pages 859-872, December.
  16. Rosser, J. Barkley, 2012. "Emergence and complexity in Austrian economics," Journal of Economic Behavior & Organization, Elsevier, vol. 81(1), pages 122-128.
  17. Roberto Leombruni, 2002. "The Methodological Status of Agent-Based Simulations," LABORatorio R. Revelli Working Papers Series 19, LABORatorio R. Revelli, Centre for Employment Studies.

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