Instability in the cobweb model under the BNN dynamic

B-Tier
Journal: Journal of Mathematical Economics
Year: 2010
Volume: 46
Issue: 2
Pages: 230-237

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The cobweb model where firms choose between rational and naive forecasting strategies has a 2-cycle when the slope of supply is greater than the slope of demand for a number of different dynamics describing the evolution of strategy choices. This paper proves that the 2-cycle is exponentially unstable under the learning dynamic of Brown et al. (1950). Issues arising in the analysis of piecewise smooth discrete time maps are discussed.

Technical Details

RePEc Handle
repec:eee:mateco:v:46:y:2010:i:2:p:230-237
Journal Field
Theory
Author Count
1
Added to Database
2026-01-29