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The Evolution of the Market and Its Growing Complexity

  • Yuji Aruka
Chapter
Part of the Evolutionary Economics and Social Complexity Science book series (EESCS, volume 1)

Abstract

The market is evolving, and particularly remarkably recently. Algorithm dominance is rapidly developing. Algorithm-based evolution is not limited to the capability of exchange servers, and humans are being replaced by transaction algorithms. The shift to high-frequency trading (HFT) has explicitly revealed the discrepancy between logical and practical transaction times. We no longer work in the realms of logical time. A slight difference in transaction speed or server design will affect the market results. We are also entering a new stage of surveillance because of the risk of illegal operations by traders. A brief look at market evolution shows a massive change in human relationships. Not only does developing algorithm dominance have an influence, but also the growing complexity, which gives rise to “the rich getting richer”. Standard economics, however, seems quite oblivious to these changes.

Keywords

Preferential Attachment Limit Order Order Book Double Auction Algorithmic Trading 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Japan 2015

Authors and Affiliations

  • Yuji Aruka
    • 1
  1. 1.Faculty of CommerceChuo UniversityHachioijiJapan

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