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INTRODUCTION

Published online by Cambridge University Press:  01 October 2007

ALAN KIRMAN
ALAN KIRMAN
Affiliation:
GREQAM, Université d'Aix-Marseille III École des Hautes Études en Sciences Sociales
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Abstract

This issue contributes to the discussion of the relation between individual and aggregate behavior. The basic feature of all the models presented is that they allow for direct interaction between the individuals. This, it is shown, leads to a number of interesting phenomena that are difficult to account for in standard models. The basic message is that the inclusion of heterogeneous interacting agents allows us to escape from the pitfalls associated with the reduction to a representative individual and furthermore to show that aggregates will, in general, have behavior that is different from that of the component individuals. Lastly, complex aggregate behavior is not necessarily the result of complicated individual reasoning, it can emerge from very simple rule following by individuals.

Keywords

Aggregate and Individual BehaviorInteractionHeterogeneityMarketsHerdingBehavioral RulesDynamicsLearning

Information

Type
INTRODUCTION
Information
Macroeconomic Dynamics , Volume 11 , Supplement S1: Interacting Agents and Market Behavior , November 2007 , pp. 1 - 7
Copyright
© 2007 Cambridge University Press

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