Related papers: Trading leads to scale-free self-organization
A simple computer simulation model of a closed market on a fixed network with free flow of goods and money is introduced. The model contains only two variables : the amount of goods and money beside the size of the system. An initially flat…
We study the distributions of money in a simple closed economic system for different types of monetary transactions. We know that for arbitrary and random sharing but locally conserving money transactions, the money distribution goes to the…
Scale-free networks are frequently described as the zenith of inequality and sometimes even pin-pointed as a natural cause of concentrations, including accumulation of resources in human society. Although coherent with theory and empirical…
It has been conjectured that canonical Bewley--Huggett--Aiyagari heterogeneous-agent models cannot explain the joint distribution of income and wealth. The results stated below verify this conjecture and clarify its implications under very…
The Zipf distribution also known as scale-free distribution or discrete Pareto distribution, is the particular case of Power Law distribution with support the strictly positive integers. It is a one-parameter distribution with a linear…
We study the interplay between evolutionary game and network structure and show how the dynamics of the game affect the growth pattern of the network and how the evolution of the network influence the cooperative behavior in the game.…
Overload-induced cascading failures can cause extreme disruptions in a wide range of networked systems, such as power grids, transportation networks, or financial systems. Empirical studies across domains report that the size of such…
Many complex systems--from social and communication networks to biological networks and the Internet--are thought to exhibit scale-free structure. However, prevailing explanations rely on the constant addition of new nodes, an assumption…
Scaling properties in financial fluctuations are reviewed from the standpoint of statistical physics. We firstly show theoretically that the balance of demand and supply enhances fluctuations due to the underlying phase transition…
We analyze wealth condensation for a wide class of stochastic economy models on the basis of the economic analog of thermodynamic potentials, termed transfer potentials. The economy model is based on three common transfers modes of wealth:…
We study efficient risk sharing among risk-averse agents in an economy with a large, finite number of states. Following a random shock to an initial agreement, agents may renegotiate. If they require a minimal utility improvement to accept…
In our model, $n$ traders interact with each other and with a central bank; they are taxed on the money they make, some of which is dissipated away by corruption. A generic feature of our model is that the richest trader always wins by…
Financial time series exhibit a number of interesting properties that are difficult to explain with simple models. These properties include fat-tails in the distribution of price fluctuations (or returns) that are slowly removed at longer…
We have studied here the self-organising features of the dynamics of a model market, where the agents `trade' for a single commodity with their money. The model market consists of fixed numbers of economic agents, money supply and…
We study the optimal decisions and equilibria of agents who aim to minimize their risks by allocating their positions over extremely heavy-tailed (i.e., infinite-mean) and possibly dependent losses. The loss distributions of our focus are…
In this paper, we introduce a large system of interacting financial agents in which each agent is faced with the decision of how to allocate his capital between a risky stock or a risk-less bond. The investment decision of investors,…
This study investigates the emergence of power-law and other concentrated distributions through a feedback loop model in crowd interactions. Agents act by their response functions to observations and external forces, while observations…
The degree distribution of a real world network -- the number of links per node -- often follows a power law, with some hubs having many more links than traditional graph generation methods predict. For years, preferential attachment and…
Using numerical simulations and scaling theory we study the dynamics of the world-wide Web from the growth rules recently proposed in Ref. [1] with appropriate parameters. We demonstrate that the emergence of power-law behavior of the out-…
The scale and terms of aggregate borrowing in an economy depend on the manner in which wealth is distributed across potential creditors with heterogeneous beliefs about the future. This distribution evolves over time as uncertainty is…