Agent-based Versus Macroscopic Modeling of Competition and Business Processes in Economics and Finance

Aleksejus Kononovicius, Vygintas Gontis and Valentas Daniunas

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Abstract: We present examples of agent-based and stochastic models of competition and business processes in economics and finance. We start from as simple as possible models, which have microscopic, agent-based, versions and macroscopic treatment in behavior. Microscopic and macroscopic versions of herding model proposed by Kirman and Bass diffusion of new products are considered in this contribution as two basic ideas. Further we demonstrate that general herding behavior can be considered as a background of nonlinear stochastic model of financial fluctuations.

Date: 2012-02, Revised 2012-06
New Economics Papers: this item is included in nep-hpe
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Published in International Journal On Advances in Intelligent Systems, volume 5, pages 111-126, 2012

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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:1202.3533

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