Investment/taxation/redistribution model criticality

Paulo Murilo Castro de Oliveira ()
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Paulo Murilo Castro de Oliveira: Instituto de Física, Universidade Federal Fluminense

The European Physical Journal B: Condensed Matter and Complex Systems, 2020, vol. 93, issue 10, 1-6

Abstract: Abstract An agent model with annual wealth investment and taxation presents a critical phase transition when one crosses the frontier regressive/progressive taxation. For the regressive case the final destiny of the society is a collapsed configuration in which all population wealth eventually remains in hands of a single agent, an absorbing state spontaneously breaking the symmetry among agents. For progressive taxation, the dynamic process continues forever with fluctuating wealths distributed among all agents; symmetry is not broken. The order parameter is the average m = −⟨logw1⟩, where w1 is the wealth share of the richest agent, vanishing at the collapsed phase. A parameter p controls the taxation progressiveness (p > 0) or regressiveness (p

Keywords: Statistical; and; Nonlinear; Physics (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1140/epjb/e2020-10308-x

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