Background: The traditional economic models are increasingly perceived as weak in explaining the bubbles and crashes in …. Methods: This paper develops an ABM to replicate financial instability, such as bubbles and crashes in asset markets, by … introducing a simple idea of "heterogeneous expectation" and "herding behavior" by which agents in different groups have different …

asynchronous bubbles emerge. Above the critical value, small random price fluctuations may be amplified by noise traders herding … is able to account for the development of endogenous bubbles and crashes. We distinguish three different regimes …’ opinions are idiosyncratic and no bubbles emerge. Around the critical value of the O(n) vector model, cross sectionally …