Income distribution: An adaptive heterogeneous model

L.C. da Silva and P.H. de Figueirêdo

Physica A: Statistical Mechanics and its Applications, 2014, vol. 395, issue C, 275-282

Abstract: In this communication an adaptive process is introduced into a many-agent model for closed economic system in order to establish general features of income distribution. In this new version agents are able to modify their exchange parameter ωi of resources through an adaptive process. The conclusions indicate that assuming an instantaneous learning behavior of all agents a Γ-distribution for income is reproduced while a frozen behavior establishes a Pareto’s distribution for income with an exponent ν=0.94±0.02. A third case occurs when a heterogeneous “inertia” behavior is introduced leading us to a Γ-distribution at the low income regime and a power-law decay for the large income values with an exponent ν=2.05±0.05. This method enables investigation of the resources flux in the economic environment and produces also bounding values for the Gini index comparable with data evidences.

Keywords: Econophysics; Income distribution; Stochastic process (search for similar items in EconPapers)
Date: 2014
References: View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:395:y:2014:i:c:p:275-282

DOI: 10.1016/j.physa.2013.09.065

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