This paper provides an example in which a slight behavioral heterogeneity may fundamentally change the qualitative properties of a nonlinear cobweb market with a quadratic cost function and an isoelastic demand function. We consider two types of producers; adaptive and naive. In a market of...

This paper provides an example in which a slight behavioral heterogeneity may fundamentally change the qualitative properties of a nonlinear cobweb market with a quadratic cost function and an isoelastic demand function. We consider two types of producers; adaptive and naive. In a market of...

We develop a learning rule that generalises the well known fading memory learning in the sense that the weights attached to the available time series data are not constant and are updated in light of the prediction error(s). The underlying idea is that confidence in the available data will be...