Related papers: Universal patterns of inequality
We analyze the data on personal income distribution from the Australian Bureau of Statistics. We compare fits of the data to the exponential, log-normal, and gamma distributions. The exponential function gives a good (albeit not perfect)…
We apply the maximum entropy principle to economic systems in equilibrium and find the density function for the market's wealth. This is the same as price density which is used for insurance pricing. The risk aversion parameter of the agent…
Exponential distribution is ubiquitous in the framework of multi-agent systems. An alternative approach with an economic motivation to derive the exponential distribution in the framework of iterations in the space of distributions is…
A class of conserved models of wealth distributions are studied where wealth (or money) is assumed to be exchanged between a pair of agents in a population like the elastically colliding molecules of a gas exchanging energy. All sorts of…
The present paper studies a large class of temperature dependent probability distributions and shows that entropy and energy can be defined in such a way that these probability distributions are the equilibrium states of a generalized…
The Price equation shows the unity between the fundamental expressions of change in biology, in information and entropy descriptions of populations, and in aspects of thermodynamics. The Price equation partitions the change in the average…
Economic systems are similar with physic systems for their large number of individuals and the exist of equilibrium. In this paper, we present a model applying the equilibrium statistical model in economic systems. Consistent with…
This paper introduces nonparametric econometric methods that characterize general power law distributions under basic stability conditions. These methods extend the literature on power laws in the social sciences in several directions.…
This Chapter reviews statistical models for the probability distribution of money developed in the econophysics literature since the late 1990s. In these models, economic transactions are modeled as random transfers of money between the…
In addition to the well known common properties such as small world and community structures, recent empirical investigations suggest a universal scaling law for the spatial structure of social networks. It is found that the probability…
The aim of this work is to establish the personal income distribution from the elementary constituents of a free market; products of a representative good and agents forming the economic network. The economy is treated as a self-organized…
Models in econophysics, i.e., the emerging field of statistical physics that applies the main concepts of traditional physics to economics, typically consist of large systems of economic agents who are characterized by the amount of money…
An heuristic model of the society, as an assembly of weakly interacting individuals, is discussed. The model allows to connect macroscopic phenomena with features of relations between individuals. Addressing to the problem of inequality, a…
We consider a model of power distribution in a social system where a set of agents play a simple game on a graph: the probability of winning each round is proportional to the agent's current power, and the winner gets more power as a…
We use the formalism of 'Maximum Principle of Shannon's Entropy' to derive the general power law distribution function, using what seems to be a reasonable physical assumption, namely, the demand of a constant mean "internal order"…
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…
To know the statistical distribution of a variable is an important problem in management of resources. Distributions of the power law type are observed in many real systems. However power law distributions have an infinite variance and thus…
This paper studies the income fluctuation problem with capital income risk (i.e., dispersion in the rate of return to wealth). Wealth returns and labor earnings are allowed to be serially correlated and mutually dependent. Rewards can be…
Growing economic inequalities are observed in several countries throughout the world. Following Pareto, the power-law structure of these inequalities has been the subject of much theoretical and empirical work. But their nonequilibrium…
A generalised notion of exponential families is introduced. It is based on the variational principle, borrowed from statistical physics. It is shown that inequivalent generalised entropy functions lead to distinct generalised exponential…