Collective opinion formation in a business climate survey
Lux, Thomas (2007) Collective opinion formation in a business climate survey. Working Paper. Coventry: Warwick Business School, Financial Econometrics Research Centre. Working papers (Warwick Business School. Financial Econometrics Research Centre) (No.07-).
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Official URL: http://www2.warwick.ac.uk/fac/soc/wbs/research/wfr...
A large body of literature has proposed models inspired by particle physics as formalizations of collective processes in the economic and social spheres of human societies [1, 2, 3, 4]. However, attempts at empirical validation of such models have been very sparse so far. This paper develops a broadly applicable methodology for estimating the parameters of microscopic models of social interactions. Its application to a popular business climate survey indicates that the collective behaviour of the survey respondents is well explained by a simple ‘particle’ model of social interactions. This result also lends support to the view that the large fluctuations of investors’ and consumers’ confidence are mostly due to ‘animal spirits’ rather than new information.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HB Economic Theory
Q Science > QC Physics
|Divisions:||Faculty of Social Sciences > Warwick Business School > Financial Econometrics Research Centre
Faculty of Social Sciences > Warwick Business School
|Library of Congress Subject Headings (LCSH):||Stochastic analysis, Statistical physics, Physics -- Research, Economics, Mathematical|
|Series Name:||Working papers (Warwick Business School. Financial Econometrics Research Centre)|
|Publisher:||Warwick Business School, Financial Econometrics Research Centre|
|Place of Publication:||Coventry|
|Official Date:||16 October 2007|
|Number of Pages:||15|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Open Access|
 Callen, E. and D. Shapero, A Theory of Social Imitation, Physics Today, July 1974, 23 - 28.
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