Abstract
This paper proposes an agent model of financial markets and analyzes factors leading to speculative bubbles and speculative chaos of the asset price. A financial market is thought to contain two typical types of traders: fundamentalists and chartists who try to maximize their utility. It is shown that the nonlinearity of the excess demand functions, which are derived as a result of the traders' utility maximization, might generate speculative bubbles and speculative chaos of the asset price.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
