Seminar Abstract

【Social Interaction in Utility Theory of Economics】

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Speaker: 有賀 裕二 ( http://arukalab.tamacc.chuo-u.ac.jp/seminar.html )

Affiliation: 中央大学 商学部 教授

Date and Time: 2002. 6.13 (Thu), 4:30 - 6:00 p.m.

Place: 3F1136

Chair: 秋山 英三


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Abstract: 

Recently, some new innovations to overcome the limitations in utility theory are 
coming up to renew our old story totally. These have some different springs. 
One of these comes from the idea of random preference in economics, which could 
be traced back to Hildenbrand(1971). Even if agents were homogeneous, 
random shock could generate a fluctuation in a macroscopic structure of 
social states. In general, interaction of heterogeneous agents is to be added on.

To argue these factors, it is noted that decision process is essentially dynamical 
in our new story. Ising model in statistical mechanics is promising to deal with 
social interaction, as Hildenbrand, and Follmer(1974) already suggested. 
In the Santa Fe's  context, Duraluf(1997), who rather gave his emphasis 
on heterogeneous subgroups, in the case when he argued the part of social 
utility for individual's decision, has shown that the Ising-type model 
could be easily compatible with binary choice for decision, a usual one 
in economics. Suppose that unobservable factors for individual's decision 
just be revealed when random shocks arrive. Decision will depend on a 
distribution of random errors. This idea can lead to a kind of Gibbs distribution 
as a decision solution of probability distribution. In this model, individual's 
decision may be affected by some conformity effects based on his reference 
subgroup. Social customs, and peculiar behaviors in subgroups could also 
continue to affect decisions of individuals, as giving a transient social state.

The other important factors to be noted are that
(i) decision making will require a finite time to reach a final judgment 
    among a series of imagined consequences; 
(ii) new agents will always arrive at or immigrate into a system, given an open society.
These consideration may rather be concisely summarized by Helbing(1995) when  he argued 
transition rates of master equation for social process in terms of complex psychological 
values like readiness, attractiveness, flexibility and so on for choice.