Encyclopedia of Complexity and Systems Science

Living Edition
| Editors: Robert A. Meyers

Minority Games

  • Chi Ho Yeung
  • Yi-Cheng Zhang
Living reference work entry
DOI: https://doi.org/10.1007/978-3-642-27737-5_332-3

Definition of the Subject

The minority game (MG) refers to the simple adaptive multi-agent model of financial markets with the original formulation introduced by Challet and Zhang in 1997. In this model of repeated games, agents choose between one of the two decisions at each round of the game, using their own simple inductive strategies. At each round, the minority group of agents win the game, and rewards are given to those strategies that predict the winning side. Daily examples of minority game include drivers choosing a less crowded road or people choosing a less crowded restaurant. Unlike most economic models or theories that assume investors are deductive in nature, a trial-and-error inductive thinking approach is implicitly implemented in the process of decision making when agents choose their choices in the games. In this original formulation, the history or the information given to agents is a string of binary bits that is composed of the winning sides in the past few rounds.

Keywords

Financial Market Symmetric Phase Volatility Cluster Replica Symmetry Cumulate Payoff 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
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Books and Reviews

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  4. Minority Game’s website. http://www.unifr.ch/econophysics/minority/

Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Department of PhysicsThe Hong Kong University of Science and TechnologyHong KongChina