A Simple Probabilistic Approach of the Yard-Sale Model

Christophe Chorro ()
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Christophe Chorro: CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique

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Abstract: We propose in the present paper a probabilistic approach of the so-called Hayes (2002) Yard-Sale model using classical diffusion approximations of Markov chains. We partly recover, at the very least for small and high frequency transactions, recent results of Boghosian (2014) and Boghosian et al. (2015) concerning both wealth condensation in the absence of redistribution mechanisms and steady state distributions when a uniform capital taxation is imposed.

Keywords: Impact of taxation; Diffusion approximations; Wealth distribution; Yard-Sale model (search for similar items in EconPapers)
Date: 2015-07
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01222500
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Published in 2015

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