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We study the dynamics of individual agents in some kinetic models of wealth exchange, particularly, the models with savings. For the model with uniform savings, agents perform simple random walks in the "wealth space". On the other hand, we…

Physics and Society · Physics 2011-01-04 Arnab Chatterjee , Parongama Sen

In this work, we modify the affine wealth model of wealth distributions to examine the effects of nonconstant redistribution on the very wealthy. Previous studies of this model, restricted to flat redistribution schemes, have demonstrated…

General Finance · Quantitative Finance 2021-10-27 Sam L. Polk , Bruce M. Boghosian

Aiming to describe the wealth distribution evolution, several models consider an ensemble of interacting economic agents that exchange wealth in binary fashion. Intriguingly, models that consider an unbiased market, that gives to each agent…

General Finance · Quantitative Finance 2021-06-30 Ben-Hur Francisco Cardoso , Sebastián Gonçalves , José Roberto Iglesias

We introduce a new stochastic duration model for transaction times in asset markets. We argue that widely accepted rules for aggregating seemingly related trades mislead inference pertaining to durations between unrelated trades: while any…

Econometrics · Economics 2020-05-20 Samuel Gingras , William J. McCausland

In this invited book chapter, we draw the reader to a brief review of the different Kinetic Exchange Models (KEMs) that have gradually developed for markets and how they can be employed to quantitatively study inequalities (the Gini Index…

Physics and Society · Physics 2023-10-31 Sanjukta Paul , Bikas K. Chakrabarti

We study a problem of optimal allocation in a discrete-time multi-period pure-exchange economy, where agents have preferences over stochastic endowment processes that are represented by strongly time-consistent dynamic risk measures. We…

Risk Management · Quantitative Finance 2026-03-23 Brandon Tam , Mario Ghossoub , Silvana M. Pesenti

In the manuscript, we are interested in using kinetic theory to better understand the time evolution of wealth distribution and their large scale behavior such as the evolution of inequality (e.g. Gini index). We investigate three type of…

Probability · Mathematics 2021-05-18 Fei Cao , Sebastien Motsch

We introduce and solve a model that mimics the herding effect in financial markets when groups of agents share information. The number of agents in the model is growing and at each time step either (i) with probability $p$ an incoming agent…

Disordered Systems and Neural Networks · Physics 2009-11-07 G. J. Rodgers , Dafang Zheng

In our multi-agent model agents generate wealth from repeated interactions for which a prisoner's dilemma payoff matrix is assumed. Their gains are taxed by a government at a rate $\alpha$. The resulting budget is spent to cover…

Physics and Society · Physics 2021-06-30 Frank Schweitzer , Luca Verginer , Giacomo Vaccario

We consider a simple model of a closed economic system where the total money is conserved and the number of economic agents is fixed. In analogy to statistical systems in equilibrium, money and the average money per economic agent are…

Statistical Mechanics · Physics 2009-10-31 Anirban Chakraborti , Bikas K. Chakrabarti

Boltzmann-Gibbs distribution arises as the statistical equilibrium probability distribution of money among the agents of a closed economic system where random and undirected exchanges are allowed. When considering a model with uniform…

Adaptation and Self-Organizing Systems · Physics 2015-06-11 Ismael Martinez-Martinez , Ricardo Lopez-Ruiz

We introduce and discuss optimal control strategies for kinetic models for wealth distribution in a simple market economy, acting to minimize the variance of the wealth density among the population. Our analysis is based on a finite time…

Physics and Society · Physics 2018-10-25 Bertram Düring , Lorenzo Pareschi , Giuseppe Toscani

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…

General Finance · Quantitative Finance 2010-11-15 Ricardo Lopez-Ruiz

We study in detail and explicitly solve the version of Kyle's model introduced in a specific case in \cite{BB}, where the trading horizon is given by an exponentially distributed random time. The first part of the paper is devoted to the…

Mathematical Finance · Quantitative Finance 2017-09-19 Umut Çetin

We introduce and discuss a nonlinear kinetic equation of Boltzmann type which describes the influence of knowledge in the evolution of wealth in a system of agents which interact through the binary trades introduced in Cordier, Pareschi,…

General Finance · Quantitative Finance 2015-06-18 Lorenzo Pareschi , Giuseppe Toscani

We model the dynamics of the Schelling model for agents described simply by a continuously distributed variable - wealth. Agents move to neighborhoods where their wealth is not lesser than that of some proportion of their neighbors, the…

Physics and Society · Physics 2017-05-23 Anand Sahasranaman , Henrik Jeldtoft Jensen

We investigate the repeated averaging model for money exchanges: two agents picked uniformly at random share half of their wealth to each other. It is intuitively convincing that a Dirac distribution of wealth (centered at the initial…

Probability · Mathematics 2021-08-19 Fei Cao

Multi-agent models have been used in many contexts to study generic collective behavior. Similarly, complex networks have become very popular because of the diversity of growth rules giving rise to scale-free behavior. Here we study…

Trading and Market Microstructure · Quantitative Finance 2009-11-13 Z. Burda , A. Krzywicki , O. C. Martin

For a class of stochastic dynamical models of exchange economies that we call ``fully connected Cobb-Douglas'', the paper proves convergence of the probability distribution to an equilibrium, in total variation metric as time goes to…

Probability · Mathematics 2025-06-16 R. S. MacKay

We investigate the unbiased model for money exchanges with collective debt limit: agents give at random time a dollar to one another as long as they have at least one dollar or they can borrow a dollar from a central bank if the bank is not…

Probability · Mathematics 2022-08-24 Fei Cao , Sébastien Motsch
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