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- Title
Type interaction models and the rule of six.
- Authors
Page, Scott
- Abstract
In this paper, I describe and analyze a class of type interaction models. In these models, an infinite population of agents with discrete types interact in groups of fixed size and possibly change their types as a function of those interactions. I then derive conditions for these models to produce multiple equilibria. These conditions demonstrate a trade off between the number of types and the size of the interacting groups. For deterministic interaction rules, I derive the rule of six: the number of agent types plus the group size must be at least six in order to support multiple equilibria given a spanning assumption.
- Subjects
ECONOMIC equilibrium; ECONOMICS; MATHEMATICAL models; ECONOMIC models; UTILITY theory; ECONOMIC demand; RISK aversion; DYNAMICS; CHIEF operating officers
- Publication
Economic Theory, 2007, Vol 30, Issue 2, p223
- ISSN
0938-2259
- Publication type
Article
- DOI
10.1007/s00199-005-0052-8