Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
10437828 | Journal of Economic Behavior & Organization | 2005 | 24 Pages |
Abstract
In this paper, we discuss a scaling approach to business fluctuations. Our starting point consists in recognizing that concepts and methods derived from physics have allowed economists to (re)discover a set of stylized facts which have to be satisfactorily accounted for in their models. Standard macroeconomics, based on a reductionist approach centered on the representative agent, is definitely badly equipped for this task. On the contrary, we show that a simple financial fragility agent-based model, based on complex interactions of heterogeneous agents, is able to replicate a large number of scaling type stylized facts with a remarkable high degree of statistical precision.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Domenico Delli Gatti, Corrado Di Guilmi, Edoardo Gaffeo, Gianfranco Giulioni, Mauro Gallegati, Antonio Palestrini,