Micro- and Macro-Level Validation in Agent-Based Simulation: Reproduction of Human-Like Behaviors and Thinking in a Sequential Bargaining Game

This paper addresses both micro- and macro-level validation in agent-based simulation (ABS) to explore validated agents that can reproduce not only human-like behaviors externally but also human-like thinking internally. For this purpose, we employ the sequential bargaining game, which can investigate a change in humans' behaviors and thinking longer than the ultimatum game (i.e., one-time bargaining game), and compare simulation results of Q-learning agents employing any type of the three types of action selections (i.e., the ε-greedy, roulette, and Boltzmann distribution selections) in the game. Intensive simulations have revealed the following implications: (1) Q-learning agents with any type of three action selections can reproduce human-like behaviors but not human-like thinking, which means that they are validated from the macro-level viewpoint but not from the micro-level viewpoint; and (2) Q-learning agents employing Boltzmann distribution selection with changing the random parameter can reproduce both human-like behaviors and thinking, which means that they are validated from both micro- and macro-level viewpoints.Micro- and Macro-Level Validation, Agent-Based Simulation, Agent Modeling, Sequential Bargaining Game, Reinforcement Learning

Coarse Thinking and Collusion in Bertrand Duopoly with Increasing Marginal Costs

Mullainathan, Schwartzstein, & Shleifer [Quarterly Journal of Economics, May 2008] put forward a model of coarse thinking. The essential idea behind coarse thinking is that agents put situations into categories and then apply the same model of inference to all situations in a given category. We extend the argument to strategies in a game-theoretic setting and propose the following: Agents split the choice-space into categories in comparison with salient choices and then choose each option in a given category with equal probability. We provide an alternative explanation for the puzzling results obtained in a Bertrand competition experiment as reported in Abbink & Brandts [Games and Economic Behavior, 63, 2008]Laboratory experiments, Oligopoly, Price competition, Co-ordination games, Coarse Thinking

Global Optimization of Minority Game by Smart Agents

We propose a new model of minority game with so-called smart agents such that the standard deviation and the total loss in this model reach the theoretical minimum values in the limit of long time. The smart agents use trail and error method to make a choice but bring global optimization to the system, which suggests that the economic systems may have the ability to self-organize into a highly optimized state by agents who are forced to make decisions based on inductive thinking for their limited knowledge and capabilities. When other kinds of agents are also present, the experimental results and analyses show that the smart agent can gain profits from producers and are much more competent than the noise traders and conventional agents in original minority game.Comment: 5 pages, 5 figure

(WP 2016-05) Hodgson, Cumulative Causation, and Reflexive Economic Agents

This paper examines Geoff Hodgson’s interpretation of Veblen in agency-structure terms, and argues it produces a conception of reflexive economic agents. It then sets out an account of cumulative causation processes using this reflexive agent conception, modeling them as a two-part causal process, one part involving a linear causal relation and one part involving a circular causal relation. The paper compares the reflexive agent conception to the standard expected utility conception of economic agents, and argues that on a cumulative causation view of the world the completeness assumption essential to the standard view of rationality cannot be applied. The final discussion addresses the nature of the choice behavior of reflexive economic agents, using the thinking of Amartya Sen and Herbert Simon to frame how agents might approach choice in regard to each of the two different parts of cumulative causal processes, and closing with brief comments on behavioral economics’ understanding of reference dependence and position adjustment

Of mind over...matter

The distinct division of clinical symptoms into what is somatic and what is psychological in human sciences, has its roots in Cartesian thinking which may have been given a lopsided emphasis. This essay argues against this strict division, using examples and data mainly referring to gastrointestinal functional somatic syndromes (psycho-somatic disorders). The effects of context and also of psychotropic agents on this interaction between psyche and soma is discussed.peer-reviewe

Mulberiddlesex

Through a careful tracing of the botanical presence of mulberry trees in Middlesex, Sandilands argues for a reading practice that takes plants seriously. Thinking with plants interrupts the tendency to consider literary plants primarily as motifs, metaphors or agents of crude naturalization. Sandilands insists on involving plants in reading Middlesex in order to take the novel in less anthropocentric directions: even as Cal enlists mulberries to signal inevitability, their own stories overflow the novel’s deterministic views of race, species, territory, and gender identity

Optimal Expectations

This paper introduces a tractable, structural model of subjective beliefs. Since agents that plan for the future care about expected future utility flows, current felicity can be increased by believing that better outcomes are more likely. On the other hand, expectations that are biased towards optimism worsen decision making, leading to poorer realized outcomes on average. Optimal expectations balance these forces by maximizing the total well-being of an agent over time. We apply our framework of optimal expectations to three different economic settings. In a portfolio choice problem, agents overestimate the return of their investment and under diversify. In general equilibrium, agents’ prior beliefs are endogenously heterogeneous, leading to gambling. Second, in a consumption-saving problem with stochastic income, agents are both overconfident and overoptimistic, and consume more than implied by rational beliefs early in life. Third, in choosing when to undertake a single task with an uncertain cost, agents exhibit several features of procrastination, including regret, intertemporal preference, reversal, and a greater readiness to accept commitment.Expectations formation, beliefs, overconfidence, wishful thinking, procrastination, gambling

Kinetic models of collective decision-making in the presence of equality bias

We introduce and discuss kinetic models describing the influence of the competence in the evolution of decisions in a multi-agent system. The original exchange mechanism, which is based on the human tendency to compromise and change opinion through self-thinking, is here modified to include the role of the agents' competence. In particular, we take into account the agents' tendency to behave in the same way as if they were as good, or as bad, as their partner: the so-called equality bias. This occurred in a situation where a wide gap separated the competence of group members. We discuss the main properties of the kinetic models and numerically investigate some examples of collective decision under the influence of the equality bias. The results confirm that the equality bias leads the group to suboptimal decisions

(WP 2013-10) Neuroeconomics and Identity

This short paper discusses majority and minority views in economics regarding the value of neuroscience for economics – and thus the value of the neuroeconomics research program. It argues that neuroeconomics’ reception ultimately depends on whether economists adopt a philosophy of science thinking closer to what exists in other sciences. It then argues that an inadvertent product of this debate is whether people can be identified as relatively independent agents. The paper concludes with comments on what this debate implies about the conception of the decision-maker as a relatively independent identity