Early artificial markets are based on boundedly rational agents having a set of fixed strategies interacting with each other. The number of strategies is usually small (often two). The names are often quite meaningful, like ``trend followers'', ``fundamental traders'', and ``portfolio insurance traders''. Usually, each strategy is fixed however, the amount of strength, or population mass using such a strategy is in some way based on past performance.

They are a form of adaptive expectations, but of a special type in that trader types interact. An often interesting result is that the price impact of destabilizing strategies is not reduced to zero.

References

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