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

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  • Fabio Tramontana

    (Department of Economics and Management, University of Pavia)

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.

Suggested Citation

  • Fabio Tramontana, 2013. "The role of cognitively biased imitators in a small scale agent-based financial market," DEM Working Papers Series 029, University of Pavia, Department of Economics and Management.
    • Handle: RePEc:pav:demwpp:029
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    File URL: http://dem-web.unipv.it/web/docs/dipeco/quad/ps/RePEc/pav/demwpp/DEMWP0029.pdf
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    References listed on IDEAS

    as
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    Cited by:

    1. Brianzoni, Serena & Campisi, Giovanni, 2020. "Dynamical analysis of a financial market with fundamentalists, chartists, and imitators," Chaos, Solitons & Fractals, Elsevier, vol. 130(C).

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