Information about Economic Agent
In economics, an agent is an actor in a model that (generally) solves an optimization problem. In this sense, it is equivalent to the term player, which is also used in economics, but is more common in game theory.
For example, buyers and sellers are two commonly-encountered types of agents in partial equilibrium models of a single market. Macroeconomic models, especially dynamic stochastic general equilibrium models that are explicitly based on microfoundations, often distinguish households, firms, and governments or central banks as the main types of agents in the economy. Each of these agents may play multiple roles in the economy; households, for example, might act as consumers, as workers, and as voters in the model. Some macroeconomic models distinguish even more types of agents, such as workers and shoppers[1] or commercial banks.[2]
The term 'agent' is also commonly used in relation to principal-agent models; in this case it refers specifically to the agent who acts on behalf of a principal.[3]
In recent years, the concept of an agent within economics has been more broadly interpreted to be any persistent individual, social, biological, or physical entity interacting with other such entities within the context of a dynamic multi-agent economic system. See, for example, Agent-Based Computational Economics.
Economic policy
Monetary policy
Central bank Money supply
Fiscal policy
Spending Deficit Debt
Trade policy
Tariff Trade agreement
Finance
Financial market
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Agency is an area of commercial law dealing with a contractual or quasi-contractual tripartite set of relationships when an Agent is authorized to act on behalf of another (called the Principal) to
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For example, buyers and sellers are two commonly-encountered types of agents in partial equilibrium models of a single market. Macroeconomic models, especially dynamic stochastic general equilibrium models that are explicitly based on microfoundations, often distinguish households, firms, and governments or central banks as the main types of agents in the economy. Each of these agents may play multiple roles in the economy; households, for example, might act as consumers, as workers, and as voters in the model. Some macroeconomic models distinguish even more types of agents, such as workers and shoppers[1] or commercial banks.[2]
The term 'agent' is also commonly used in relation to principal-agent models; in this case it refers specifically to the agent who acts on behalf of a principal.[3]
In recent years, the concept of an agent within economics has been more broadly interpreted to be any persistent individual, social, biological, or physical entity interacting with other such entities within the context of a dynamic multi-agent economic system. See, for example, Agent-Based Computational Economics.
Representative vs. heterogenous agents
An economic model in which all agents of a given type (such as all consumers, or all firms) are assumed to be exactly identical is called a representative agent model. A model which recognizes differences among agents is called a heterogeneous agent model. Economists often use representative agent models when they want to describe the economy in the simplest terms possible. In contrast, they may be obliged to use heterogeneous agent models when differences among agents are directly relevant for the question at hand.[4] For example, considering heterogeneity in age might be essential in a model used to study the economic effects of pensions; considering heterogeneity in wealth might be essential in a model used to study precautionary saving[5] or redistributive taxation.[6]See also
References
1. ^ Robert Lucas, Jr., and Nancy Stokey (1987), 'Money and interest in a cash-in-advance economy'. Econometrica 55 (3), pp. 491-513.
2. ^ Timothy S. Fuerst (1992), 'Liquidity, loanable funds, and real activity'. Journal of Monetary Economics 29 (1), pp. 3-24.
3. ^ Joseph E. Stiglitz (1987). "Principal and agent", The , v. 3, pp. 966-71.
4. ^ José-Víctor Ríos-Rull (1995): 'Models with heterogeneous agents'. Chapter 4 in T. Cooley (ed.) Frontiers of Business Cycle Theory, Princeton University Press, ISBN 069104323X.
5. ^ Christopher Carroll (1997), 'Buffer-stock saving and the Life Cycle/Permanent Income Hypothesis'. Quarterly Journal of Economics 112 (1), pp. 1-56.
6. ^ Roland Benabou (2002), 'Tax and education policy in a heterogeneous-agent economy: What levels of redistribution maximize growth and efficiency?' Econometrica 70(2), pp. 481-517.
2. ^ Timothy S. Fuerst (1992), 'Liquidity, loanable funds, and real activity'. Journal of Monetary Economics 29 (1), pp. 3-24.
3. ^ Joseph E. Stiglitz (1987). "Principal and agent", The , v. 3, pp. 966-71.
4. ^ José-Víctor Ríos-Rull (1995): 'Models with heterogeneous agents'. Chapter 4 in T. Cooley (ed.) Frontiers of Business Cycle Theory, Princeton University Press, ISBN 069104323X.
5. ^ Christopher Carroll (1997), 'Buffer-stock saving and the Life Cycle/Permanent Income Hypothesis'. Quarterly Journal of Economics 112 (1), pp. 1-56.
6. ^ Roland Benabou (2002), 'Tax and education policy in a heterogeneous-agent economy: What levels of redistribution maximize growth and efficiency?' Econometrica 70(2), pp. 481-517.
Economics is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Greek for oikos (house) and nomos (custom or law), hence "rules of the house(hold).
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mathematical model is an abstract model that uses mathematical language to describe the behaviour of a system. Mathematical models are used particularly in the natural sciences and engineering disciplines (such as physics, biology, and electrical engineering) but also in the social
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In mathematics, the term optimization, or mathematical programming, refers to the study of problems in which one seeks to minimize or maximize a real function by systematically choosing the values of real or integer variables from within an allowed set.
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A player of a game is a participant therein. The term 'player' is used with this same meaning both in game theory and in ordinary recreational games.
Normally, there are at least two players in a game, but one-player games exist and are collectively known as solitary games
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Normally, there are at least two players in a game, but one-player games exist and are collectively known as solitary games
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Game theory is a branch of applied mathematics that is often used in the context of economics. It studies strategic interactions between agents. In strategic games, agents choose strategies which will maximize their return, given the strategies the other agents choose.
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partial equilibrium is a part of the general economic equilibrium, where the clearance on the market of some specific goods is obtained independently from prices and quantities demanded and supplied on other goods' markets.
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A model in macroeconomics is a logical, mathematical, and/or computational framework designed to describe the operation of a national or regional economy, and especially the dynamics of aggregate quantities such as the total amount of goods and services produced, total income
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Dynamic stochastic general equilibrium modeling (abbreviated DSGE or sometimes DGE) is a branch of applied general equilibrium theory that is increasingly influential in contemporary macroeconomics.
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In economics, the term microfoundations refers to the microeconomic analysis of the behavior of individual agents such as households or firms that underpins a macroeconomic theory (Barro, 1993, Glossary, p. 594).
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household is the basic unit of analysis in many microeconomic and government models. The term refers to all individuals who live in the same dwelling.
Most economic models do not address whether the members of a household are a family in the traditional sense.
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Most economic models do not address whether the members of a household are a family in the traditional sense.
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FIRM may refer to:
Firm or The Firm can have several meanings:
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- Center for Community Change
- Flood Insurance Rate Map
See also
- Firm
Firm or The Firm can have several meanings:
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government is a body that has the power to make and the authority to enforce rules and laws within a civil, corporate, religious, academic, or other organization or group.[1]
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Economic policy
Monetary policy
Central bank Money supply
Fiscal policy
Spending Deficit Debt
Trade policy
Tariff Trade agreement
Finance
Financial market
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In political science and economics, the principal-agent problem treats the difficulties that arise under conditions of incomplete and asymmetric information when a principal hires an agent.
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- See also principal
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Agent-based Computational Economics (ACE) is the computational study of economic processes modeled as dynamic systems of interacting agents.
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Overview
The "agents" in ACE models can represent individuals (e.g. people), social groupings (e.g. firms), biological entities (e...... Click the link for more information.
In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and quantitative relationships between them.
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The notion of a representative agent is a hypothetical construct in economics.
Its origins can be traced back to the late 19th century. Francis Edgeworth (1881) used the term "representative particular", while Alfred Marshall (1890) introduced a "representative firm" in his
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Its origins can be traced back to the late 19th century. Francis Edgeworth (1881) used the term "representative particular", while Alfred Marshall (1890) introduced a "representative firm" in his
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Homo economicus, or Economic man, is the concept in some economic theories of man (that is, a human) as a rational and self-interested actor who desires wealth, avoids unnecessary labor, and has the ability to make judgments towards those ends.
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A rational agent takes actions which, given his or her knowledge of its environment, maximizes its chances of success.
The action a rational agent takes depends on:
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The action a rational agent takes depends on:
- the agent's past experiences
- the agent's information of its environment
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The notion of a representative agent is a hypothetical construct in economics.
Its origins can be traced back to the late 19th century. Francis Edgeworth (1881) used the term "representative particular", while Alfred Marshall (1890) introduced a "representative firm" in his
..... Click the link for more information.
Its origins can be traced back to the late 19th century. Francis Edgeworth (1881) used the term "representative particular", while Alfred Marshall (1890) introduced a "representative firm" in his
..... Click the link for more information.
For other senses of the word "agency", see agency.
Agency is an area of commercial law dealing with a contractual or quasi-contractual tripartite set of relationships when an Agent is authorized to act on behalf of another (called the Principal) to
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Joseph E. Stiglitz
Born January 9 1943
Gary, Indiana
Residence U.S.
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Born January 9 1943
Gary, Indiana
Residence U.S.
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