Market Mood, Adaptive Beliefs and Asset Price Dynamics

Empirical evidence has suggested that, facing different trading strategies and complicated decision, the proportions of agents relying on particular strategies may stay at constant level or vary over time. This paper presents a simple "dynamic market fraction" model of two groups of traders, fundamentalists and trend followers, under a market maker scenario. Market mood and evolutionary adaption are characterized by fixed and adaptive switching fraction among two groups, respectively. Using local stability and bifurcation analysis, as well as numerical simulation, the role played by the key parameters in the market behaviour is examined. Particular attention is payed to the impact of the market fraction, determined by the fixed proportions of confident fundamentalists and trend followers, and by the proportion of adaptively rational agents, who adopt different strategies over time depending on realized profits.

Reservation Forecasting Models for Hospitality SMEs with a View to Enhance Their Economic Sustainability

In many tourism destinations, sustainability of the local economy leans on small and medium-sized hotels that are individually owned and operated by members of the community. Suffering from seasonality more than their big competitors, these hotels should undertake marketing initiatives to counteract wide demand fluctuations. Such initiatives are most effective if based on accurate occupancy forecasts, which must be performed at the individual hotel level. In this aim, the present paper suggests a demand forecasting approach adapted to specific features that characterize reservation data for small and medium-sized enterprises (SMEs) in the hospitality sector. The proposed framework integrates historical and advanced booking methods into a forecast combination with time-varying, performance-based weights. Whereas historical methods use only past observations about the number of guests recorded on a particular stay night to forecast future room occupancy (long-term perspective), advanced booking methods predict bookings-to-come based on partially accumulated data from reservations on hand (short-term perspective). In order to provide a possible solution to data sparsity issues that affect the application of advanced booking models to hospitality SMEs, a procedure that incorporates length-of-stay information directly into the reservation processing phase is also introduced. The methodology is tested on real time series of reservation data from three Italian hotels, located either in a city center (Milan) or in a typical destination for seasonal holidays (Lake Maggiore). Model parameters are calibrated on a training dataset and the accuracy of the occupancy forecasts is evaluated on a holdout sample. The results validate earlier findings about combinations of long-term and short-term forecasts and, in addition, show that using performance-based weights improves the quality of forecasts. Reducing the risk of large forecast failures, the proposed methodology can indeed have practical implications for the design and implementation of effective demand-side policies in hospitality SMEs. These policies are expected to provide a competitive advantage that can be crucial to the sustainability of small establishments in a context of growing global tourism

ITACOSM 2013 Forecasting techniques for short-term demand of hotel bookings

Abstract Although the practice of Revenue Management in airline companies dates back to the early 1970s, only recently it has expanded to the tourism industry, owing to the availability of large amounts of reservation dat

An assessment of the implementation of the European tourism indicator system for sustainable destinations in Italy

The European Tourism Indicators System (ETIS) is a product of the European Union (EU) Sustainable Development Strategy, which was formulated with the objectives of promoting economic prosperity, social equity, cohesion, and environmental protection. In this paper, we present an analysis of the results of the implementation of the ETIS during the period 2013-2016, in the Italian tourist destination of South Sardinia. While the implementation of ETIS constitutes a significant advancement in Italy, and more widely in Europe, our findings reveal that an adaptive management approach is necessary for achieving the anticipated objectives and adapting these standardized indicators to different territorial contexts. Difficulties were encountered in both data collection and stakeholders' involvement in the implementation process. Insufficient knowledge, and familiarity with the complex technical aspects of the indicator toolkit among primary stakeholders, was another constraint associated with its implementation. We believe that the findings of this analysis can provide guidelines and inputs for other European countries and tourist destinations that are currently in the process of implementing the ETIS toolkit or similar methodologies. In particular, the pioneering sustainable tourism performance measurement system (STPMS) can be adapted to meet local needs

Border Collision Bifurcations in a Footloose Capital Model with First Nature Firms

Piecewise smooth map, Border collision bifurcations, New Economic Geography, Footloose Capital models,

Complex dynamics associated with the appearance/disappearance of invariant closed curves

In this paper we study some global bifurcations arising in a heterogeneous financial model with fundamentalists and imitators. Such bifurcations which cause the appearance and disappearance of closed invariant curves (attracting or repelling) involve the stable and unstable sets of a saddle cycle with consequent changes in their dynamic behavior. Numerical investigations show that the transition between two qualitatively different regimes are characterized by the occurrence of homoclinic tangles with chaotic dynamics

Agglomeration dynamics and first nature asymmetries

The standard footloose capital(FC) model, as well as the discrete time version, assumes that all capital units are internationally mobile between two regions. In this paper, we assume that in one of the two regions some of the blueprints/capital units may be immobile because their utilization requires some locally specific natural resource (first nature advantage). Mobile blueprints, instead, can be utilized in both regions. We focus on this asymmetric distribution of immobile firms/capital units, labeled first nature firms. The central question of our paper is how the existence of first nature asymmetry affects agglomerative processes framed in discrete time. This modification of the FC model leads to a one dimensional piecewise smooth map for which we show analytically that border collision bifurcations are pervasive and (even asymmetric) multistability is possible