title: Asset price and wealth dynamics as an adaptive belief system.
abstract: In this paper we study an asset pricing model with heterogeneous beliefs, wealth dynamics and time varying proportions. We derive the resulting deterministic nonlinear dynamic system and analyze the model with adaptive beliefs and switching mechanism in order to investigate bifurcations and global dynamics and thus consider the effects on wealth distribution among different types of agents. Our study aims at confirming that heterogeneity in beliefs may lead to complexity.
authors.affiliation: University of Macerata, Italy.
authors.forename: Serena
authors.initials: S
authors.lastname: Brianzoni
authors.forename: Cristiana
authors.initials: C
authors.lastname: Mammana
authors.forename: Elisabetta
authors.initials: E
authors.lastname: Michetti