Increasing Inequality and Financial Fragility in an An Agent Based Macroeconomic Model

Alberto Russo, Luca Riccetti and Mauro Gallegati

MPRA Paper from University Library of Munich, Germany

Abstract: The aim of this paper is to investigate the relationship between increasing inequality and financial fragility in an agent based macroeconomic model. We analyse the effects of a non-linear relationship between wealth and consumption on the evolution of the economic system. Preliminary results show that more inequality rises macroeconomic volatility, increasing the likelihood of observing large unemployment crises.

Keywords: agent-based model; business cycle; inequality; crisis (search for similar items in EconPapers)
JEL-codes: C63 D31 E21 E32 (search for similar items in EconPapers)
Date: 2013-06
New Economics Papers: this item is included in nep-cmp and nep-mac
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:51528

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