Agent Based and Evolutionary Modeling of Asset Markets

Abstract

The next chapters deal with some advanced topics in the dynamic modeling of asset markets. The current chapter represents a brief introduction to recent developments in financial market studies that build on heterogeneous agent and evolutionary models of asset market dynamics. We have already briefly discussed, in Chap. 6, heterogeneous agent models which borrow from evolutionary theory. Here we want to go into more details of recent heterogeneous agent and evolutionary models. We will only discuss two interesting prototype models. In Chap. 16 then we will study further approaches that have also moved away from expected utility maximizing models.