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A Note on Stability of Self-Consistent Equilibrium in an Asynchronous Model of Discrete-Choice with Social Interaction


  • Kaizoji, Taisei


The aim of this paper is to demonstrate that dynamic paths in a model of discrete choice with social interactions, which have been developed by Brock and Durlauf (1999, 2001a, 2001b, 2006), converge some self-consistent equilibrium. To this aim, we propose an asynchronous model of discrete-choice with social interaction2 , in which the only individual selected cyclically is updated.

Suggested Citation

  • Kaizoji, Taisei, 2012. "A Note on Stability of Self-Consistent Equilibrium in an Asynchronous Model of Discrete-Choice with Social Interaction," MPRA Paper 38730, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:38730

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    References listed on IDEAS

    1. Sinkey, Joseph F, Jr, 1975. "A Multivariate Statistical Analysis of the Characteristics of Problem Banks," Journal of Finance, American Finance Association, vol. 30(1), pages 21-36, March.
    2. Robert B. Avery & Gerald A. Hanweck, 1984. "A dynamic analysis of bank failures," Research Papers in Banking and Financial Economics 74, Board of Governors of the Federal Reserve System (U.S.).
    3. Lennox, Clive, 1999. "Identifying failing companies: a re-evaluation of the logit, probit and DA approaches," Journal of Economics and Business, Elsevier, vol. 51(4), pages 347-364, July.
    4. Stephen M. Miller & Athanasios Noulas, 1995. "Explaining Recent Connecticut Bank Failures," Working papers 1995-01, University of Connecticut, Department of Economics.
    5. Edward I. Altman, 1968. "Financial Ratios, Discriminant Analysis And The Prediction Of Corporate Bankruptcy," Journal of Finance, American Finance Association, vol. 23(4), pages 589-609, September.
    6. Crowley, Frederick D. & L. Loviscek, Anthony, 1990. "New directions in predicting bank failures: The case of small banks," North American Review of Economics and Finance, Elsevier, vol. 1(1), pages 145-162.
    7. Martin, Daniel, 1977. "Early warning of bank failure : A logit regression approach," Journal of Banking & Finance, Elsevier, vol. 1(3), pages 249-276, November.
    8. Rebel Cole & Jeffery Gunther, 1998. "Predicting Bank Failures: A Comparison of On- and Off-Site Monitoring Systems," Journal of Financial Services Research, Springer;Western Finance Association, vol. 13(2), pages 103-117, April.
    9. Keshari, Pradeep K & Paul, Thomas M, 1994. "Relative efficiency of foreign and domestic Banks," MPRA Paper 47072, University Library of Munich, Germany.
    10. Altman, Edward I., 1977. "Predicting performance in the savings and loan association industry," Journal of Monetary Economics, Elsevier, vol. 3(4), pages 443-466, October.
    11. Hwang, Dar-Yeh & Lee, Cheng F. & Liaw, K. Thomas, 1997. "Forecasting bank failures and deposit insurance premium," International Review of Economics & Finance, Elsevier, vol. 6(3), pages 317-334.
    12. Gormley, Todd A., 2010. "The impact of foreign bank entry in emerging markets: Evidence from India," Journal of Financial Intermediation, Elsevier, vol. 19(1), pages 26-51, January.
    13. Arturo Estrella & Sangkyun Park & Stavros Peristiani, 2000. "Capital ratios as predictors of bank failure," Economic Policy Review, Federal Reserve Bank of New York, issue Jul, pages 33-52.
    14. Espahbodi, Pouran, 1991. "Identification of problem banks and binary choice models," Journal of Banking & Finance, Elsevier, vol. 15(1), pages 53-71, February.
    15. repec:bla:joares:v:4:y:1966:i::p:71-111 is not listed on IDEAS
    16. Sensarma, Rudra, 2006. "Are foreign banks always the best? Comparison of state-owned, private and foreign banks in India," Economic Modelling, Elsevier, vol. 23(4), pages 717-735, July.
    17. Claessens, Stijn & Demirguc-Kunt, Asl[iota] & Huizinga, Harry, 2001. "How does foreign entry affect domestic banking markets?," Journal of Banking & Finance, Elsevier, vol. 25(5), pages 891-911, May.
    18. Zhao, Tianshu & Casu, Barbara & Ferrari, Alessandra, 2010. "The impact of regulatory reforms on cost structure, ownership and competition in Indian banking," Journal of Banking & Finance, Elsevier, vol. 34(1), pages 246-254, January.
    19. James B. Thomson, 1991. "Predicting bank failures in the 1980s," Economic Review, Federal Reserve Bank of Cleveland, issue Q I, pages 9-20.
    20. Clarke, George R. G. & Cull, Robert & D'Amato, Laura & Molinari, Andrea, 1999. "The effect of foreign entry on Argentina's domestic banking sector," Policy Research Working Paper Series 2158, The World Bank.
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    More about this item


    binary choice; social interactions; stability of self-consistent equilibrium; asynchronous model;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • C44 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Operations Research; Statistical Decision Theory
    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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