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Recognizing Investment Opportunities at the Onset of Recoveries

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  • Guido Fioretti

    () (University of Siena, Centro Sistemi Complessi)

Abstract

Investment decision-making is modeled by means of a Kohonen neural net, whose neurons represent firms as decision-makers. Thus, the network reconstructs collective decision-making by the productive system. This model focuses on the decision to invest in novel fields of activity, which requires that managers recognize the emergence of a new technological pattern. Recognizing the value of information is not obvious, since it depends on a firm's mental categories. For instance, in 1964 Olivetti sold its electronics division in the firm belief, well supported by a tradition of excellence in mechanics, that computers would never substitute typing machines.

Suggested Citation

  • Guido Fioretti, "undated". "Recognizing Investment Opportunities at the Onset of Recoveries," Modeling, Computing, and Mastering Complexity 2003 07, Society for Computational Economics.
  • Handle: RePEc:sce:cplx03:07
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    References listed on IDEAS

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    Cited by:

    1. Guido Fioretti, 2005. "The Production Function," Papers physics/0511191, arXiv.org.
    2. Fioretti, Guido, 2007. "The production function," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 374(2), pages 707-714.

    More about this item

    Keywords

    Investment; Innovation; Accelerator; Neural Networks; Cognition; Mental Categories;

    JEL classification:

    • C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics
    • D29 - Microeconomics - - Production and Organizations - - - Other
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O49 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Other

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