Eastern Economic Journal

, Volume 37, Issue 1, pp 35–43

Active and Passive Learning in Agent-based Financial Markets

  • Blake LeBaron
Article

Abstract

This short note compares and contrasts two forms of learning which are present in most agent-based financial markets. First, passive learning refers to a form of “as if rationality” where wealth accumulates on strategies which have done relatively well. Second active learning refers to the active switching of agents across strategies. Most heterogeneous agent markets contain some form of both these types of learning. From what we know so far the dynamics of each may be quite different, and may yield a rich and complex joint dynamic.

Keywords

agent-based financial markets evolutionary finance learning 

JEL Classifications

G11 G14 G17 D84 

Copyright information

© Eastern Economic Association 2010

Authors and Affiliations

  • Blake LeBaron
    • 1
  1. 1.International Business School, Brandeis UniversityWalthamUSA

Personalised recommendations