InterJournal Complex Systems, 826
Status: Accepted
Manuscript Number: [826]
Submission Date: 2004
Explaining economic and social phenomenon: models with low cognition, interacting agents
Author(s): Rich Colbaugh ,Paul Ormerod

Subject(s): CX.18

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Abstract:

The standard socio-economic science model requires the assumption of powerful cognition on behalf of its agents. Efficient outcomes arise from the cognitive powers of the agents. An alternative view posits that efficiency is the joint product of institutional structure and agent actions . Models in which agents have low cognition may be able to offer superior accounts of many socio-economic phenomena than the standard approach. We present two original empirical findings in two completely different areas, and show that they are both consistent with being emergent phenomena in models of low cognition agents. A key feature of both models is the need to characterise the topology of interactions accurately. The areas are 1) the distribution of the size of US economic recessions 2) the distribution of self-reported acts of criminality in the Pittsburgh Youth Offenders data base

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