A multi-agent dynamic model based on different kinds of bequests

Jian Cui, Qiuhui Pan, Qian Qian, Mingfeng He and Qilin Sun

Physica A: Statistical Mechanics and its Applications, 2013, vol. 392, issue 6, 1393-1397

Abstract: We investigate how wealth transfer that happens at the end of an agent’s life affects its final distribution based on a multi-agent dynamic model. We discuss two kinds of wealth transfers: to a single agent and to charities. The first kind of bequest is common in our realistic world and is always regarded by the public as unequal inheritance. The bequests to charities will be gathered and then equally redistributed among the survivors in our model. We find that when all the decedents choose the second kind of bequest, the final distribution is the Gibbs exponential function. When all the decedents choose the first kind of bequest, the result is condensation that a single individual accumulates all the available wealth. When an increasing portion of decedents choose the one-heir bequests, the exponential distribution evolves towards a power law shape (accompanied by deteriorating inequality). This shape firstly appears from the intermediate range of wealth and extends towards the top end of the simulated distribution, while the distribution remains exponential for high values of the wealth. At the same time, the Gini coefficient increases and the wealth accumulation becomes serious. At last, we analyze the source of the inequality. We find that not only unequal inheritances, but also equal division of the charity’s wealth can relatively contribute to an inequality of wealth distribution.

Keywords: Wealth distribution; Multi-agent dynamic model; Bequests to a single heir; Bequests to charities (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:392:y:2013:i:6:p:1393-1397

DOI: 10.1016/j.physa.2012.11.021

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