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Occupy the Financial Niche – Saturation and Crisis (discontinuous decisions)

Author

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  • Ionut Purica

    (Hyperion University of Bucharest, Romania)

Abstract

The model presented is proposing an approach that could verify the nonlinear behaviour during a crisis, such that to quantify and predict potential discontinuous behaviour. In this case, the crisis behaviour associated with financial funds reallocation among various credit instruments, described as memes with the sense of Dawkins, is shown to be of discontinuous nature stemming from a logistic penetration in the financial behaviour niche. Actually the logistic penetration is typical in creating cyclic behaviour of economic structures as shown by Marchetti and others from IIASA. A Fokker-Planck equation description results in a stationary solution having a bifurcation like solution with evolution trajectories on a ‘cusp’ type catastrophe that may describe discontinuous decision behaviour.

Suggested Citation

  • Ionut Purica, 2014. "Occupy the Financial Niche – Saturation and Crisis (discontinuous decisions)," Hyperion Economic Journal, Faculty of Economic Sciences, Hyperion University of Bucharest, Romania, vol. 2(3), pages 13-19, September.
    • Handle: RePEc:hyp:journl:v:2:y:2014:i:3:p:13-19
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    File URL: http://hej.hyperion.ro/articles/3(2)_2014/HEJ%20nr3(2)_2014_A2Purica.pdf
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    Citations

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    Cited by:

    1. Ionut PURICA & Liviu Lucian ALBU & Marioara IORDAN & Sorin DINU, 2020. "Models for Nonlinear Decisions Overview and Two Case Examples in Finance and Energy," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 194-201, July.

    More about this item

    Keywords

    nonlinear models; decision; financial crisis; meme;
    All these keywords.

    JEL classification:

    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics

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