Surprise, surprise: From Neoclassical economics to E-life

Ingram D, Tayler P, & Thompson M (2012). Surprise, surprise: From Neoclassical economics to E-life. ASTIN Bulletin 42 (2): 389-411. DOI:10.2143/AST.42.2.2182803.

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Abstract

We build and describe an agent-based model: the Surprise Game. The game comprises a 'world' of 30 firms, each of which has to survive (and, if possible, prosper) in its environment, which is nothing more than the other 29 firms. Each firm has to latch onto one or other of the four strategies that are predicted by the theory of plural rationality but has to relinquish that strategy and latch onto one of the others if it finds itself surprised. This model illustrates the dynamics of the world as described by the theory of plural rationality which are more similar to the dynamics of the actual world than economic models that assume equilibriums that are occasionally disturbed by shocks. This model and the theory of plural rationality provide insights and ideas for further work for actuaries.

Item Type: Article
Research Programs: Risk, Policy and Vulnerability (RPV)
Risk & Resilience (RISK)
Bibliographic Reference: ASTIN Bulletin - The Journal of the International Actuarial Association; 42(2):389-411
Depositing User: IIASA Import
Date Deposited: 15 Jan 2016 08:46
Last Modified: 04 Apr 2016 10:16
URI: http://pure.iiasa.ac.at/9888

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