Why the rich become richer: insights from an agent-based model

Saul Desiderio and Siyan Chen

International Journal of Computational Economics and Econometrics, 2016, vol. 6, issue 3, 258-275

Abstract: The aim of this paper is to investigate the reason why the rich get richer in an agent-based macroeconomic model. It shows that simulated top income and wealth follows a power law. From a dynamical point of view, it is found that revenues from financial investments are the key factor to sustaining wealth accumulation. In other words, wealth-dependent asymmetries among agents generates the power law tail.

Keywords: agent-based modelling; income distribution; wealth distribution; Gini coefficient; wealth inequality; agent-based systems; multi-agent systems; MAS; macroeconomic models; simulation; financial investments; wealth accumulation; wealth-dependent asymmetries; power law tail. (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijcome:v:6:y:2016:i:3:p:258-275

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