Herding without following the herd: the dynamics of case-based decisions with local interactions

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Citation (Scopus)

Abstract

We use case-based decision theory to evaluate the repeated choices of individuals who are using the experience of a selected set of other individuals over a given time horizon as the basis for their own decisions. It is observed that for certain parameter constellations a large fraction of individuals make identical decisions over a long period of time, which is not implied by the information. The result of this behavior is herding, which, however, has its origin in the way individuals process information rather than a desire to be part of the herd and imitating the behavior of others.
Original languageEnglish
Title of host publicationThe Complex Networks of Economic Interactions
Subtitle of host publicationEssays in Agent-Based Economics and Econophysics
EditorsA Namatame, T Kaizouji, Y Aruka
PublisherSpringer
Pages179-191
ISBN (Print)9783540287261
DOIs
Publication statusPublished - 2006

Publication series

NameLecture Notes in Economics and Mathematical Systems
NumberPart IV
Volume567

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