Wealth dynamics on complex networks

Diego Garlaschelli and Maria I Loffredo

Physica A: Statistical Mechanics and its Applications, 2004, vol. 338, issue 1, 113-118

Abstract: We study a model of wealth dynamics (Physica A 282 (2000) 536) which mimics transactions among economic agents. The outcomes of the model are shown to depend strongly on the topological properties of the underlying transaction network. The extreme cases of a fully connected and a fully disconnected network yield power-law and log-normal forms of the wealth distribution, respectively. We perform numerical simulations in order to test the model on more complex network topologies. We show that the mixed form of most empirical distributions (displaying a non-smooth transition from a log-normal to a power-law form) can be traced back to a heterogeneous topology with varying link density, which on the other hand is a recently observed property of real networks.

Keywords: Complex networks; Econophysics; Wealth distribution; Pareto's law; Stochastic processes (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:338:y:2004:i:1:p:113-118

DOI: 10.1016/j.physa.2004.02.032

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