The role of cognitively biased imitators in a small scale agent-based financial market

Fabio Tramontana

No 29, DEM Working Papers Series from University of Pavia, Department of Economics and Management

Abstract: We analyze the consequences of the presence of imitators in a financial market populated by boundedly rational speculators. We consider imitators that only look at the recent success of the available trading rules. We show that the introduction of this kind of imitators makes the results more complicated but even more realistic. In particular, under some specific circumstances, imitators may stabilize an otherwise unstable market or, at the opposite, make unstable an otherwise stable scenario.

Pages: 23 pages
Date: 2013-01
New Economics Papers: this item is included in nep-cbe and nep-evo
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Citations: View citations in EconPapers (1)

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