Patterns of consumption in socio-economic models with heterogeneous interacting agents
We study consumption behaviour in systems with heterogeneous interacting agents. Two different models are introduced, respectively with long and short range interactions among agents. At any time step an agent decides whether or not to consume a good, doing so if this provides positive utility. Utility is affected by idiosyncratic preferences and costs as well as externalities from other agents. Agents are ranked in classes and recognize peer, distinction and aspiration groups. We simulate the system for different choices of the parameters and identify different complex patterns: a steady state regime with a variety of consumption modes of behaviour, and a wave/cycle regime. The cases of fad and value goods are both analyzed.
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- Aoki,Masanao, 1998. "New Approaches to Macroeconomic Modeling," Cambridge Books, Cambridge University Press, number 9780521637695.
- Robin Cowan & William Cowan & G.M. Peter Swann, 2004.
"Waves in consumption with interdependence among consumers,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 37(1), pages 149-177, February.
- Cowan Robin & Cowan William & Swann Peter, 1998. "Waves in Consumption with Interdependence among Consumers," Research Memorandum 007, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
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