Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/104964
Authors: 
Heilig, Stephan
Schöbel, Rainer
Year of Publication: 
2001
Series/Report no.: 
Tübinger Diskussionsbeitrag 205
Abstract: 
In this paper we generalize a chaos control method developed by Ott, Grebogi and Yorke (1990) to control saddle points in R2 which are embadded in a strange attractor of a chaotic system. Our generalized method admits to control any unstable equilibrium in R2. We apply our findings to control the dynamics of the chaotic asset pricing model of Brock and Hommes (1998). In this model chaotic price movements are caused by heterogenous market participants. We introduce a control authority which trades the risky asset like the other market participants. Using our control approach, it is possible for the authority to stabilize the market price with minimum effort.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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