Interdependent preferences

Consumer preferences can be influenced by the choices of other consumers in many ways. For example, through imitative (or bandwagon) and escaping (or snob) behaviors. Consumption choices are adopted with regard to a reference group. In this paper we propose a model in which agents can be not only locally connected to their reference group but, in some degree, also globally connected to all agents. The result is a network structure in which consumers are the nodes, and links are given by local and global interactions. In particular, links between agents belonging to different social groups can only be given by the presence of global interaction whereas local interaction creates a link between agents of the same class. The first aim of the paper is the building of a general model. The second one is the study, in a particular simplified case, of the dynamic behaviours of the model arising with different weights given to the local or to the global interactions. The main result of the paper is given by the determination of the conditions for the coexistence of different types of attractors (fixed points, periodic cycles and chaotic attractors) and by the numerical study of the global bifurcations that change the qualitative nature of the attractors and the structure of the basins of attraction. © 2009 Springer Berlin Heidelberg.