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Computational approach to the emergence and evolution of language - evolutionary naming game model

Computational modelling with multi-agent systems is becoming an important technique of studying language evolution. We present a brief introduction into this rapidly developing field, as well as our own contributions that include an analysis of the evolutionary naming-game model. In this model communicating agents, that try to establish a common vocabulary, are equipped with an evolutionarily selected learning ability. Such a coupling of biological and linguistic ingredients results in an abrupt transition: upon a small change of the model control parameter a poorly communicating group of linguistically unskilled agents transforms into almost perfectly communicating group with large learning abilities. Genetic imprinting of the learning abilities proceeds via Baldwin effect: initially unskilled communicating agents learn a language and that creates a niche in which there is an evolutionary pressure for the increase of learning ability. Under the assumption that communication intensity increases continuously with finite speed, the transition is split into several transition-like changes. It shows that the speed of cultural changes, that sets an additional characteristic timescale, might be yet another factor affecting the evolution of language. In our opinion, this model shows that linguistic and biological processes have a strong influence on each other and this effect certainly has contributed to an explosive development of our species.

physics.soc-ph↗

Analysing tax evasion dynamics via the Ising model

We develop a model of tax evasion based on the Ising model. We augment the model using an appropriate enforcement mechanism that may allow policy makers to curb tax evasion. With a certain probability tax evaders are subject to an audit. If they get caught they behave honestly for a certain number of periods. Simulating the model for a range of parameter combinations, we show that tax evasion may be controlled effectively by using punishment as an enforcement mechanism.

q-fin.GN↗

From short to fat tails in financial markets: A unified description

In complex systems such as turbulent flows and financial markets, the dynamics in long and short time-lags, signaled by Gaussian and fat-tailed statistics, respectively, calls for a unified description. To address this issue we analyze a real dataset, namely, price fluctuations, in a wide range of temporal scales to embrace both regimes. By means of Kramers-Moyal (KM) coefficients evaluated from empirical time series, we obtain the evolution equation for the probability density function (PDF) of price returns. We also present consistent asymptotic solutions for the timescale dependent equation that emerges from the empirical analysis. From these solutions, new relationships connecting PDF characteristics, such as tail exponents, to parameters of KM coefficients arise. The results reveal a dynamical path that leads from Gaussian to fat-tailed statistics, furnishing insights on other complex systems where akin crossover is observed.

q-fin.ST↗

The norm game in a mean-field society

Mean field Master equations for the norm game are investigated. The strategies are: to obey the norm or not and to punish those who break it or not. The punishment, the temptation, the punishment cost and the relaxation of vengeance are modeled by four parameters; for the fixed points, only two ratios of these parameters are relevant. The analysis reveals two phases; in one of them, nobody obeys the norm and nobody punishes. This phase is stable if the punishment is small enough. In the other phase, the proportion of defectors depends on the parameters and in some cases it can be arbitrarily small. A transcritical bifurcation appears between the two phases. Numerical calculations show that the relaxation time shows a sharp maximum at the bifurcation point. The model is adapted also for the case of two mutually punishing groups. A difference between the solutions for two groups appears if the punishment of one group by the other is weaker, than the opposite.

physics.soc-ph↗

What Is There Between Any Two Nodes in a Complex Network?

This article focuses on the identification of the number of paths with different lengths between pairs of nodes in complex networks and how, by providing comprehensive information about the network topology, such an information can be effectively used for characterization of theoretical and real-world complex networks, as well as for identification of communities.

physics.soc-ph↗

Emergence of firms in $(d+1)$-dimensional work space

Standard micro-economics concentrate on the description of markets but is seldom interested in production. Several economists discussed the concept of a firm, as opposed to an open labour market where entrepreneurs would recrute workers on the occasion of each business opportunity. Coase \cite{Coase} is one of them, who explains the existence of firms as institution because they reduce the transaction costs with respect to an open labour market. Whatever the rationale proposed by economists to account for the existence of firms, their perspective is based on efficiency and cost analysis. Little attention is paid to the dynamics of emergence and evolution of firms. The aim of the present manuscript is to check the global dynamical properties of a very simple model based on bounded rationality and reinforcement learning. Workers and managers are localised on a lattice and they choose collaborators on the basis of the success of previous work relations. The choice algorithm is largely inspired rom the observation and modeling of long term customer/sellers relationships observed on perishable goods markets discussed in Weisbuch etal\cite{Weisbuch} and Nadal etal\cite{Nadal}. The model presented here is in no way an alternative to Coase. We describe the build-up of long term relationships which do reduce transaction costs, and we deduce the dynamical properties of networks built from our simple assumptions. In conclusion, the present model explains the metastability of employment relations in the firm, but something has to be added to it to explain the more efficient workload repartition observed in real firms.

q-fin.GN↗

Cheap Artificial AB-Mountains, Extraction of Water and Energy from Atmosphere and Change of Regional Climate

Author suggests and researches a new revolutionary method for changing the climates of entire countries or portions thereof, obtaining huge amounts of cheap water and energy from the atmosphere. In this paper is presented the idea of cheap artificial inflatable mountains, which may cardinally change the climate of a large region or country. Additional benefits: The potential of tapping large amounts of fresh water and energy. The mountains are inflatable semi-cylindrical constructions from thin film (gas bags) having heights of up to 3 - 5 km. They are located perpendicular to the main wind direction. Encountering these artificial mountains, humid air (wind) rises to crest altitude, is cooled and produces rain (or rain clouds). Many natural mountains are sources of rivers, and other forms of water and power production - and artificial mountains may provide these services for entire nations in the future. The film of these gasbags is supported at altitude by small additional atmospheric overpressure and may be connected to the ground by thin cables. The author has shown (in previous works about the AB-Dome) that this closed AB-Dome allows full control of the weather inside the Dome (the day is always fine, the rain is only at night, no strong winds) and influence to given region. This is a realistic and cheap method of economical irrigation, getting energy and virtual weather control on Earth at the current time.

physics.gen-ph↗

The Scaling laws of Spatial Structure in Social Networks

Social network structure is very important for understanding human information diffusing, cooperating and competing patterns. It can bring us with some deep insights about how people affect each other. As a part of complex networks, social networks have been studied extensively. Many important universal properties with which we are quite familiar have been recovered, such as scale free degree distribution, small world, community structure, self-similarity and navigability. According to some empirical investigations, we conclude that our social network also possesses another important universal property. The spatial structure of social network is scale invariable. The distribution of geographic distance between friendship is about $Pr(d)\propto d^{-1}$ which is harmonious with navigability. More importantly, from the perspective of searching information, this kind of property can benefit individuals most.

physics.soc-ph↗

Moving Mini-Max - a new indicator for technical analysis

We propose a new indicator for technical analysis. The indicator emphasizes maximums and minimums in price series with inherent smoothing and has a potential to be useful in both mechanical trading rules and chart pattern analysis.

q-fin.ST↗

Econophysics: historical perspectives

Econophysics embodies the recent upsurge of interest by physicists into financial economics, driven by the availability of large amount of data, job shortage in physics and the possibility of applying many-body techniques developed in statistical and theoretical physics to the understanding of the self-organizing economy. This brief historical survey emphasizes that Econophysics has many historical precursors, and is in fact rooted in a continuous cross-fertilization between economics and physics that has been active in the last centuries.

q-fin.GN↗

An empirical investigation of the g-index for 26 physicists in comparison with the h-index, the A-index, and the R-index

Hirsch has introduced the h-index to quantify an individual's scientific research output by the largest number h of a scientist's papers that received at least h citations. In order to take into account the highly skewed frequency distribution of citations, Egghe proposed the g-index as an improvement of the h-index. I have worked out 26 practical cases of physicists from the Institute of Physics at Chemnitz University of Technology and compare the h and g values. It is demonstrated that the g-index discriminates better between different citation patterns. This can also be achieved by evaluating Jin's A-index which reflects the average number of citations in the h-core and interpreting it in conjunction with the h-index. h and A can be combined into the R-index to measure the h-core's citation intensity. I have also determined the A and R values for the 26 data sets. For a better comparison, I utilize interpolated indices. The correlations between the various indices as well as with the total number of papers and the highest citation counts are discussed. The largest Pearson correlation coefficient is found between g and R. Although the correlation between g and h is relatively strong, the arrangement of the data set is significantly different, depending on whether they are put into order according to the values of either h or g.

physics.soc-ph↗

The universal shape of economic recession and recovery after a shock

We show that a simple and intuitive three-parameter equation fits remarkably well the evolution of the gross domestic product (GDP) in current and constant dollars of many countries during times of recession and recovery. We then argue that this equation is the response function of the economy to isolated shocks, hence that it can be used to detect large and small shocks, including those which do not lead to a recession; we also discuss its predictive power. Finally, a two-sector toy model of recession and recovery illustrates how the severity and length of recession depends on the dynamics of transfer rate between the growing and failing parts of the economy.

q-fin.GN↗

Differences between normal and shuffled texts: structural properties of weighted networks

In this paper we deal with the structural properties of weighted networks. Starting from an empirical analysis of a linguistic network, we analyse the differences between the statistical properties of a real and a shuffled network and we show that the scale free degree distribution and the scale free weight distribution are induced by the scale free strength distribution, that is Zipf's law. We test the result on a scientific collaboration network, that is a social network, and we define a measure, the vertex selectivity, that can easily distinguish a real network from a shuffled network. We prove, via an ad-hoc stochastic growing network with second order correlations, that this measure can effectively capture the correlations within the topology of the network.

physics.data-an↗

Waiting Times in Simulated Stock Markets

Exploiting a precise reproduction of a stock exchange, the robustness of the Continuous Double Auction (CDA) mechanism, evaluated by means of the waiting time distributions, has been proved versus 36 different set ups made by varying both the operators' behaviour and the market micro structure. The obtained results demonstrate that the CDA remains able to clear strongly different order flows, though the Milan stock exchange seemed to be a little more efficient than the NYSE under the allocative point of view, witnessing the intrinsic complexity of the stock market. The simulation has been built as an Agent Based Model in order to obtain a plausible order flow. The decisions of single agents and their interaction through the market book are realistic and reproduce some empirical analysis results. The mentioned results have been obtained either by the analysis of the complete pending time series and the same computation of the asks and bids series alone.

q-fin.TR↗

Finite-time singularity in the evolution of hyperinflation episodes

A model proposed by Sornette, Takayasu, and Zhou for describing hyperinflation regimes based on adaptive expectations expressed in terms of a power law which leads to a finite-time singularity is revisited. It is suggested to express the price index evolution explicitly in terms of the parameters introduced along the theoretical formulation avoiding any combination of them used in the original work. This procedure allows to study unambiguously the uncertainties of such parameters when an error is assigned to the measurement of the price index. In this way, it is possible to determine an uncertainty in the critical time at which the singularity occurs. For this purpose, Monte Carlo simulation techniques are applied. The hyperinflation episodes of Peru (1969-90) and Weimar Germany (1920-3) are reexamined. The first analyses performed within this framework of the very extreme hyper-inflations occurred in Greece (1941-4) and Yugoslavia (1991-4) are reported. The study of the hyperinflation spiral experienced just nowadays in Zimbabwe predicts a singularity, i.e., a complete economic crash within two years.

q-fin.CP↗

Mirror-time diffusion discount model of options pricing

The proposed model modifies option pricing formulas for the basic case of log-normal probability distribution providing correspondence to formulated criteria of efficiency and completeness. The model is self-calibrating by historic volatility data; it maintains the constant expected value at maturity of the hedged instantaneously self-financing portfolio. The payoff variance dependent on random stock price at maturity obtained under an equivalent martingale measure is taken as a condition for introduced "mirror-time" derivative diffusion discount process. Introduced ksi-return distribution, correspondent to the found general solution of backward drift-diffusion equation and normalized by theoretical diffusion coefficient, does not contain so-called "long tails" and unbiased for considered 2004-2007 S&P 100 index data. The model theoretically yields skews correspondent to practical term structure for interest rate derivatives. The method allows increasing the number of asset price probability distribution parameters.

q-fin.PR↗

Current log-periodic view on future world market development

Applicability of the concept of financial log-periodicity is discussed and encouragingly verified for various phases of the world stock markets development in the period 2000-2010. In particular, a speculative forecasting scenario designed in the end of 2004, that properly predicted the world stock market increases in 2007, is updated by setting some more precise constraints on the time of duration of the present long-term equity market bullish phase. A termination of this phase is evaluated to occur in around November 2009. In particular, on the way towards this dead-line, a Spring-Summer 2008 increase is expected. On the precious metals market a forthcoming critical time signal is detected at the turn of March/April 2008 which marks a tendency for at least a serious correction to begin. In the present extended version some predictions for the future oil price are incorporated. In particular a serious correction on this market is expected to start in the coming days.

q-fin.ST↗

Cluster Expansion Method for Evolving Weighted Networks Having Vector-like Nodes

The Cluster Variation Method known in statistical mechanics and condensed matter is revived for weighted bipartite networks. The decomposition of a Hamiltonian through a finite number of components, whence serving to define variable clusters, is recalled. As an illustration the network built from data representing correlations between (4) macro-economic features, i.e. the so called $vector$ $components$, of 15 EU countries, as (function) nodes, is discussed. We show that statistical physics principles, like the maximum entropy criterion points to clusters, here in a (4) variable phase space: Gross Domestic Product (GDP), Final Consumption Expenditure (FCE), Gross Capital Formation (GCF) and Net Exports (NEX). It is observed that the $maximum$ entropy corresponds to a cluster which does $not$ explicitly include the GDP but only the other (3) ''axes'', i.e. consumption, investment and trade components. On the other hand, the $minimal$ entropy clustering scheme is obtained from a coupling necessarily including GDP and FCE. The results confirm intuitive economic theory and practice expectations at least as regards geographical connexions. The technique can of course be applied to many other cases in the physics of socio-economy networks.

physics.soc-ph↗