AGENT MODELING OF COMPETITION AND COEVOLUTION OF FINTECH AND REGTECH2 IN THE GLOBAL FINANCIAL ECOSYSTEM: THE RED QUEEN EFFECT

Abstract

This paper examines the competition and co-evolution of FinTech and RegTech2 in the global financial ecosystem using the methods of evolutionary economics. A simple agent-based model is built on the NetLogo platform and the emergence of cycles of technological dominance in the ecosystem is shown. The paper also discusses the “technological arms race” of regulators and system participants as a result of the co-evolution and competition of two technology groups, known as the red queen effect.