Money distribution in agent-based models with position-exchange dynamics: the Pareto paradigm revisited

Ekrem Aydiner (), Andrey G. Cherstvy and Ralf Metzler
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Ekrem Aydiner: Istanbul University
Andrey G. Cherstvy: Institute for Physics & Astronomy, University of Potsdam
Ralf Metzler: Institute for Physics & Astronomy, University of Potsdam

The European Physical Journal B: Condensed Matter and Complex Systems, 2019, vol. 92, issue 5, 1-4

Abstract: Abstract Wealth and income distributions are known to feature country-specific Pareto exponents for their long power-law tails. To propose a rationale for this, we introduce an agent-based dynamic model and use Monte Carlo simulations to unveil the wealth distributions in closed and open economical systems. The standard money-exchange scenario is supplemented with the position-exchange agent dynamics that vitally affects the Pareto law. Specifically, in closed systems with position-exchange dynamics the power law changes to an exponential shape, while for open systems with traps the Pareto law remains valid. Graphical abstract

Keywords: Statistical; and; Nonlinear; Physics (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (6)

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DOI: 10.1140/epjb/e2019-90674-0

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