The dynamics of individual characteristics of economic agents is modeled with the link structure influenced by this dynamics: links between agents with similar characteristics are more stable than those between agents with vastly different characteristics. A simple scaling law describes the...

This paper proposes a percolation-based model of new-product diffusion in the spirit of Solomon et al. (2000) and Goldenberg et al. (2000). A consumer buys the new product if she has formed her individual valuation of the product (reservation price) and if this valuation is greater or equal than...

A model of new-product diffusion is proposed in which a site-percolation dynamics represents socially driven diffusion of knowledge about the product's characteristics in a population of consumers. A consumer buys the new product if her valuation of it—formed after her witnessing the product...

We propose a stochastic model of interactive formation of individual expectations regarding the business climate in an industry. Our model is motivated by a business climate survey conducted since 1960 in Germany by the Ifo-institute (www.ifo.de). In accordance with the data structure of this...

We empirically investigate distributions of individual consumption expenditure f or four commodity categories conditional on fixed income levels. The data stems from the Family Expenditure Survey carried out annually in the United Kingdom. W e use graphical techniques to test for normality and...

We propose a simple Keynesian business cycle model in which national income expectations of heterogeneous interacting investors affect their investment decisions. The investors' expectation formation is influenced by their sentiment: investors who hold optimistic views about the future state of...