Delayed information flow effect in economy systems. An ACP model study

Applying any strategy requires some knowledge about the past state of the system. Unfortunately in the case of economy collecting information is a difficult, expensive and time consuming process. Therefore the information about the system is known at the end of some well defined intervals, e. g. company reports, inflation data, GDP etc. They describe a (market) situation in the past. The time delay is specific to the market branch. It can be very short (e.g. stock market offer is updated every minute or so and this information is immediately available) or long, like months in the case of agricultural market, when the decisions are taken based on the results from the previous harvest. The analysis of the information flow delay can be based on the ACP model of spatial evolution of economic systems. The entities can move on a square lattice and when meeting take one of the two following decisions: merge or create a new entity. The decision is based on the system state, which is known with some time delay. The effect of system's feedback is investigated. We consider the case of company distribution evolution in a heterogenous field. The information flow time delay implies different final states, including cycles.Comment: Presented at APFA

Model of macroeconomic evolution in stable regionally dependent economic fields

We develop a model for the evolution of economic entities within a geographical type of framework. On a square symmetry lattice made of three (economic) regions, firms, described by a scalar fitness, are allowed to move, adapt, merge or create spin-offs under predetermined rules, in a space and time dependent economic environment. We only consider here one timely variation of the ''external economic field condition''. For the firm fitness evolution we take into account a constraint such that the disappearance of a firm modifies the fitness of nearest neighboring ones, as in Bak-Sneppen population fitness evolution model. The concentration of firms, the averaged fitness, the regional distribution of firms, and fitness for different time moments, the number of collapsed, merged and new firms as a function of time have been recorded and are discussed. Also the asymptotic values of the number of firms present in the three regions together with their average fitness, as well as the number of respective births and collapses in the three regions are examined. It appears that a sort of $critical$ selection pressure exists. A power law dependence, signature of self-critical organization is seen in the birth and collapse asymptotic values for a high selection pressure only. A lack of self-organization is also seen at region borders.Comment: 11 figures double columns on 7 page

Exponential and power-law probability distributions of wealth and income in the United Kingdom and the United States

We present the data on wealth and income distributions in the United Kingdom, as well as on the income distributions in the individual states of the USA. In all of these data, we find that the great majority of population is described by an exponential distribution, whereas the high-end tail follows a power law. The distributions are characterized by a dimensional scale analogous to temperature. The values of temperature are determined for the UK and the USA, as well as for the individual states of the USA.Comment: 8 pages, 6 figures, elsart.cls. Submitted to Physica A, proceedings of NATO workshop Applications of Physics in Economic Modeling, Prague, February 2001. V.2: minor stylistic expansio

A logistic map approach to economic cycles I. The best adapted companies

A birth-death lattice gas model about the influence of an environment on the fitness and concentration evolution of economic entities is analytically examined. The model can be mapped onto a high order logistic map. The control parameter is a (scalar) "business plan". Conditions are searched for growth and decay processes, stable states, upper and lower bounds, bifurcations, periodic and chaotic solutions. The evolution equation of the economic population for the best fitted companies indicates "microscopic conditions" for cycling. The evolution of a dynamic exponent is shown as a function of the business plan parameters.Comment: 10 pages, 5 postscript figure

Influence of information flow in the formation of economic cycles

A microscopic approach to macroeconomic features is intended. A model for macroeconomic behavior based on the Ausloos-Clippe-Pekalski model is built and investigated. The influence of a discrete time information transfer is investigated. The formation of economic cycles is observed as a function of the time of information delay. Three regions of delay time are recognized: short $t_d \in (2 IS, 4 IS)$ (IS - iteration steps) - the system evolves toward a unique stable equilibrium state, medium $t_d =5 IS$ or $t_d =6 IS$, the system undergoes oscillations: stable concentration cycles appear in the system. For long information flow delay times, $t_d \geq 7$, the systems may crash for most initial concentrations. However, even in the case of long delay time the crash time may be long enough to allow observation of the system evolution and to introduce an appropriate strategy in order to avoid the collapse of the e.g. company concentration. In the long time delay it is also possible to observe an "economy resonance" where despite a long delay time the system evolves for a long time or can even reach a stable state, which insures its existence.Comment: 18 pages,16 figures, to be published in Verhulst 200 Proceedings, M. Ausloos and M. Dirickx, Eds. (in press

Sources of Financial Fragility: Financial Factors in the Economics of Capitalism

Originally, paper prepared for the conference, Coping with Financial Fragility: A Global Perspective, 7-9 September 1994, Maasdricht. (sic) Also included are handwritten and word processed pages showing original drafts of the paper

Financial Factors in the Economics of Capitalism

Journal of Financial Services Research, Vol 9, No. 3-4, 197-208