Professor Cars Hommes has been visiting the Department of Economics at the HSE St. Petersburg
On Friday and Saturday, October 21-22, Professor Cars Hommes from the University of Amsterdam has been visiting the Department of Economics at the HSE St. Petersburg.
On Friday, October 21, Cars Hommes gave a talk on the developments of the so-called learning-to-forecast experiments, used to test theories of expectations and learning. Experiment participants must repeatedly forecast a market price, whose realization is an aggregation of individual expectations. Emphasis is given to how individual forecasting rules interact at the micro-level and which structure they co-create at the aggregate macro-level. It turns out that the type of expectations feedback is crucial for the (in)stability of experimental markets. Negative feedback systems, such as supply driven commodity markets, are rather stable and quickly settle down to the rational equilibrium. Positive feedback systems, such as speculative asset markets, are rather unstable and fluctuate wildly around the fundamental equilibrium with repeated bubbles and crashes. The talk has also discussed a behavioural heuristics switching model, where agents switch between strategies based upon their relative performance, that matches individual as well as aggregate behaviour of the lab experiments quite nicely.
On Saturday, October 22, Cars Hommes participated in a workshop where the HSE faculty had a chance to present their experimental research projects. The presentations were followed by a round table discussion about the IBSEN-2020 project, as well as pros and cons of opening an experimental lab at the HSE.
Cars Hommes has published more than 100 articles in leading journals and book chapters, has been Editor of the Journal of Economic Dynamics and Control 2002-2012 and currently is member of five editorial boards of international journals. He has obtained several grants from the Dutch Science Foundation (NWO), the European Commission (EC) and is an Institute of New Economic Thinking (INET) grantee. He is the President Elect of the Society of Computational Economics (SCE), 2014-2016, the author of the recent book Behavioral Rationality and Heterogeneous Expectations in Complex Economic Systems, Cambridge University Press, 2013 and winner of the Distinguished Lorentz Fellowship 2014 in the Netherlands for his interdisciplinary research.