A class of heterogeneous agent models is investigated where investors switch trading position whenever their motivation to do so exceeds some critical threshold. These motivations can be psychological in nature or reflect behaviour suggested by the efficient market hypothesis (EMH). By introducing different propensities into a baseline model that displays EMH behaviour, one can attempt to isola...

In this paper we extend the original heterogeneous agent model by introducing smart traders and changes in agents’ sentiment. The idea of smart traders is based on the endeavor of market agents to estimate future price movements. By adding smart traders and changes in sentiment we try to improve the original heterogeneous agents model so that it provides a closer description of real markets. Th...

We continue an investigation into a class of agent-based market models that are motivated by a psychologically-plausible form of bounded rationality. Some of the agents in an otherwise efficient hypothetical market are endowed with differing tolerances to the tension caused by being in the minority. This herding tendency may be due to purely psychological effects, momentum-trading strategies, o...

Monetary policy rule is an approach to avoid time inconsistency problem as regarded by new classical economist to choose a time plan for policy making in order to maximize households’ well-being. The foundation of time inconsistency problem is not coincidence of expectations as an ex-ante variable, which is expected variable, with actual variable as an ex-post variable. Expectations in Finn K...

In the realization of agent-based applications the developer generally needs to use heterogeneous agent architectures, so that each application component can optimally perform its task. Languages that easily model the heterogeneity of agents’ architectures are very useful in the early stages of the application development. This paper presents HEMASL, a simple meta-language used to specify heter...

Traditionally, Dynamic Scoring calculations experiements are carried out using representative agent based macroeconomic models. Existing literature does not provide any objection to this approach. In this paper, I develop a heterogeneous agent model similar to the SaverSpenders model of Mankiw(2000). But spenders in my model are merely credit constrained and not Rule of thumb consumers. Both gr...

some metaphor to guide our actions and expectations. Most human-computer interfaces can be classified according to two dominant metaphors: (1) agent and (2) environment. Interactions based on an agent metaphor treat the computer as an intermediary that responds to user requests. In the environment metaphor, a model of the task domain is presented for the user to interact with directly. The term...