The linkage between financial market and real economy : the analysis with an agent based simulation

Financial markets are driven by the real economy and in turn also has a profound effect on the financial economy. Understanding the feedback between these two sectors leads to a deeper understanding of the stability, robustness and efficiency of the economic system. In this paper, we investigate the effect of credit linkages on the macroeconomic activity by developing an agent-based model, which allows us to explain some key elements occurred during the recent economic and financial crisis. In particular, we study the linkage dependence among agents (firms and banks) at the micro-level and to estimate their impact on the macro activities such as the GDP growth rate, the size and growth rate distributions of agents

Evolution of Reciprocal Cooperation in the Avatamsaka Game

The Avatamsaka game is investigated both analytically and using computer simulations. The Avatamsaka game is a dependent game in which each agent’s payoff depends completely not on her own decision but on the other players’. Consequently, any combination of mixed strategies is a Nash equilibrium.Analysis and evolutionary simulations show that the socially optimal state becomes evolutionarily stable by a Pavlovian strategy in the repeated Avatamsaka game, and also in any kind of dependent game. The mechanism of the evolutionary process is investigated from the viewpoint of the agent’s memory and mutation of strategies.Book Series：Lecture Notes in Economics and Mathematical SystemsThis Book：The Complex Networks of Economic InteractionsEssays in Agent-Based Economics and Econophysic

Cliophysics: A scientific analysis of recurrent historical events

Named after Clio, the Greek goddess of history, cliophysics is a daughter (and in a sense an extension) of econophysics. Like econophysics it relies on the methodology of experimental physics. Its purpose is to conduct a scientific analysis of historical events. Such events can be of sociological, political or economic nature. In this last case cliophysics would coincide with econophysics. The main difference between cliophysics and econophysics is that the description of historical events may be qualitative as well as quantitative. For the handling of qualitative accounts cliophysics has developed an approach based on the identification of patterns. To detect a pattern the main challenge is to break the "noise barrier". The very existence of patterns is what makes cliophysics possible and ensures its success. Briefly stated, once a pattern is detected, it allows predictions to be made. As the capacity to make successful predictions is the hallmark of any science, it becomes easy to decide whether or not the claim made in the title of the paper is indeed fulfilled. A number of examples of clusters of similar events will be given which should convince readers that historical events can be simplified almost at will very much as in physics. One should not forget that physical effects are also subject to the environment. For instance, if tried at the equator, the experiment of the Foucault pendulum will fail. In the last part of the paper, we describe cliophysical investigations conducted over the past decades; they make us confident that cliophysics can be a valuable tool for decision makers.Comment: 15 pages, 1 figure, 3 table

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The linkage between financial market and real economy : the analysis with an agent based simulation

Financial markets are driven by the real economy and in turn also has a profound effect on the financial economy. Understanding the feedback between these two sectors leads to a deeper understanding of the stability, robustness and efficiency of the economic system. In this paper, we investigate the effect of credit linkages on the macroeconomic activity by developing an agent-based model, which allows us to explain some key elements occurred during the recent economic and financial crisis. In particular, we study the linkage dependence among agents (firms and banks) at the micro-level and to estimate their impact on the macro activities such as the GDP growth rate, the size and growth rate distributions of agents