Hierarchical Economic Agents and their Interactions

We present a new type of spin market model, populated by hierarchical agents, represented as configurations of sites and arcs in an evolving network. We describe two analytic techniques for investigating the asymptotic behavior of this model: one based on the spectral theory of Markov chains and ano...

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Bibliographic Details
Published in:arXiv.org 2015-03
Main Author: Theodosopoulos, Ted
Format: Article
Language:English
Subjects:
Asymptotic properties
Cellular automata
Markov chains
Phase transitions
Spectral theory
Online Access:Get full text
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Summary:We present a new type of spin market model, populated by hierarchical agents, represented as configurations of sites and arcs in an evolving network. We describe two analytic techniques for investigating the asymptotic behavior of this model: one based on the spectral theory of Markov chains and another exploiting contingent submartingales to construct a deterministic cellular automaton that approximates the stochastic dynamics. Our study of this system documents a phase transition between a sub-critical and a super-critical regime based on the values of a coupling constant that modulates the tradeoff between local majority and global minority forces. In conclusion, we offer a speculative socioeconomic interpretation of the resulting distributional properties of the system.
ISSN:2331-8422