On Misapplications of Diffusion Approximations in Birth and Death Processes of Noisy Evolution

Yuri (Yuriy) Kaniovski (Kaniovskyi) ()

Working Papers from International Institute for Applied Systems Analysis

Abstract: Birth and death processes with a finite number of states are used in modeling different kinds of noisy learning processes in economics. To analyze the long run properties one looks a the corresponding stationary distribution. When the number of states is large, the stationary distribution becomes bulky and difficult to analyze. To simplify the analysis in such a situation and hence to make the long run properties of the learning process more transparent, a diffusion approximation has been suggested. Unfortunately, quite often such such approximation is not correctly done. Why this happens and how the situation can be fixed is discussed in this note.

Date: 1998-08
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.iiasa.ac.at/Publications/Documents/IR-98-050.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.iiasa.ac.at/Publications/Documents/IR-98-050.pdf [301 Moved Permanently]--> https://www.iiasa.ac.at/Publications/Documents/IR-98-050.pdf [301 Moved Permanently]--> https://iiasa.ac.at//Publications/Documents/IR-98-050.pdf [302 Found]--> https://iiasa.ac.at/Publications/Documents/IR-98-050.pdf)
http://www.iiasa.ac.at/Publications/Documents/IR-98-050.ps (application/postscript)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.iiasa.ac.at/Publications/Documents/IR-98-050.ps [301 Moved Permanently]--> https://www.iiasa.ac.at/Publications/Documents/IR-98-050.ps [301 Moved Permanently]--> https://iiasa.ac.at//Publications/Documents/IR-98-050.ps [302 Found]--> https://iiasa.ac.at/Publications/Documents/IR-98-050.ps)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wop:iasawp:ir98050

Access Statistics for this paper

More papers in Working Papers from International Institute for Applied Systems Analysis Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().