A neural networks approach to minority game

The minority game (MG) comes from the so-called “El Farol bar” problem by W.B. Arthur. The underlying idea is competition for limited resources and it can be applied to different fields such as: stock markets, alternative roads between two locations and in general problems in which the players in the “minority” win. Players in this game use a window of the global history for making their decisions, we propose a neural networks approach with learning algorithms in order to determine players strategies. We use three different algorithms to generate the sequence of minority decisions and consider the prediction power of a neural network that uses the Hebbian algorithm. The case of sequences randomly generated is also studied. Research supported by Local Project 2004–2006 (EX 40%) Università di Foggia. A. Sfrecola is a researcher financially supported by Dipartimento di Scienze Economiche, Matematiche e Statistiche, Università degli Studi di Foggia, Foggia, Italy.