Recognizing Investment Opportunities at the Onset of Recoveries

Guido Fioretti

Modeling, Computing, and Mastering Complexity 2003 from Society for Computational Economics

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.

Keywords: Investment; Innovation; Accelerator; Neural Networks; Cognition; Mental Categories (search for similar items in EconPapers)
JEL-codes: C45 D29 E27 L29 O30 O49 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe and nep-cmp
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Related works:
Working Paper: Recognizing Investment Opportunities at the Onset of Recoveries (2002)
Journal Article: Recognising investment opportunities at the onset of recoveries (2006)
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Persistent link: http://EconPapers.repec.org/RePEc:sce:cplx03:07

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