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We develop a model for the evolution of wealth in a non-conservative economic environment, extending a theory developed earlier by the authors. The model considers a system of rational agents interacting in a game theoretical framework.…

General Finance · Quantitative Finance 2015-06-19 Pierre Degond , Jian-Guo Liu , Christian Ringhofer

In this paper, we investigate the economic mobility in some money transfer models which have been applied into the research on wealth distribution. We demonstrate the mobility by recording the time series of agents' ranks and observing…

Physics and Society · Physics 2009-11-11 Ning Ding , Ning Xi , Yougui Wang

Pareto law, which states that wealth distribution in societies have a power-law tail, has been a subject of intensive investigations in statistical physics community. Several models have been employed to explain this behavior. However, most…

Trading and Market Microstructure · Quantitative Finance 2009-11-13 M. Ali Saif , Prashant M. Gade

We present a detailed numerical analysis of the modified version of a conservative self-organized extremal model introduced by Pianegonda et. al. for the distribution of wealth of the people in a society. Here the trading process has been…

General Finance · Quantitative Finance 2015-05-30 Abhijit Chakraborty , G. Mukherjee , S. S. Manna

We introduce a model with conserved dynamics, where nearest neighbor pairs of spins $\uparrow \downarrow (\downarrow \uparrow)$ can exchange to assume the configuration $\downarrow \uparrow (\uparrow \downarrow)$, with rate $\beta…

Condensed Matter · Physics 2010-10-12 Antonio M. R. Cadilhe , Vladimir Privman

We propose a dynamical model for group formation and switching behavior in systems where each group competes for members through attraction functions that are inversely proportional to their current sizes. This attraction is modulated by…

Dynamical Systems · Mathematics 2026-03-12 Samit Ghosh

A money transfer involves a buyer and a seller. A buyer buys goods or services from a seller. The money the buyer decreases is the same as that the seller increases. At each time step, a pair of socially connected agents are selected and…

Mathematical Finance · Quantitative Finance 2023-07-07 Hsin-Lun Li

In the present paper a model of a market consisting of real and financial interacting sectors is studied. Agents populating the stock market are assumed to be not able to observe the true underlying fundamental, and their beliefs are biased…

General Finance · Quantitative Finance 2018-06-13 Fausto Cavalli , Ahmad Naimzada , Nicolò Pecora , Marina Pireddu

Economy is demanding new models, able to understand and predict the evolution of markets. To this respect, Econophysics offers models of markets as complex systems, that try to comprehend macro-, system-wide states of the economy from the…

Trading and Market Microstructure · Quantitative Finance 2015-05-20 Carmen Pellicer-Lostao , Ricardo Lopez-Ruiz

Given the wealth inequality worldwide, there is an urgent need to identify the mode of wealth exchange through which it arises. To address the research gap regarding models that combine equivalent exchange and redistribution, this study…

Theoretical Economics · Economics 2023-01-26 Takeshi Kato

One of the key socioeconomic phenomena to explain is the distribution of wealth. Bouchaud and M\'ezard have proposed an interesting model of economy [Bouchaud and M\'ezard (2000)] based on trade and investments of agents. In the mean-field…

Statistical Finance · Quantitative Finance 2009-02-03 Matus Medo

We examine the statistical properties of a closed monetary economy with multi-aggregates interactions. Building upon Yakovenko's single-agent monetary model (Dragulescu and Yakovenko, 2000), we investigate the joint equilibrium distribution…

Theoretical Economics · Economics 2024-01-19 Andrea Monaco , Matteo Ghio , Adamaria Perrotta

Many-body dynamical models in which Boltzmann statistics can be derived directly from the underlying dynamical laws without invoking the fundamental postulates of statistical mechanics are scarce. Interestingly, one such model is found in…

Statistical Mechanics · Physics 2023-11-06 Maggie Miao , Kristian Blom , Dmitrii E. Makarov

We study a model of wealth dynamics [Bouchaud and M\'ezard 2000, \emph{Physica A} \textbf{282}, 536] which mimics transactions among economic agents. The outcomes of the model are shown to depend strongly on the topological properties of…

Disordered Systems and Neural Networks · Physics 2009-02-06 D. Garlaschelli , M. I. Loffredo

Standard approaches to the theory of financial markets are based on equilibrium and efficiency. Here we develop an alternative based on concepts and methods developed by biologists, in which the wealth invested in a financial strategy is…

General Finance · Quantitative Finance 2022-10-12 Maarten P. Scholl , Anisoara Calinescu , J. Doyne Farmer

Asset exchange models (AEMs) provide a physics-inspired framework for studying wealth formation. These models capture wealth distribution dynamics via pairwise money exchanges, yielding steady-state distributions from exponential to…

Physics and Society · Physics 2025-09-30 Joel Wagner , Siew Ann Cheong , Viola Priesemann

We propose a stochastic map model of economic dynamics. In the last decade, an array of observations in economics has been investigated in the econophysics literature, a major example being the universal features of inequality in terms of…

General Finance · Quantitative Finance 2015-05-27 Anindya S. Chakrabarti

We study dynamics of a simulated world with stock and money, driven by the externally given processes which we refer to as sentiments. The considered sentiments influence the buy/sell stock trading attitude, the perceived price uncertainty,…

Trading and Market Microstructure · Quantitative Finance 2017-07-26 Mikhail Goykhman

We develop a general framework, based on Boltzmann transport theory, to analyze the distribution of wealth in societies. Within this framework we derive the distribution function of wealth by using a two-party trading model for the poor…

Statistical Mechanics · Physics 2016-08-31 Arnab Das , Sudhakar Yarlagadda

We look at how asset exchange models can be mapped to random iterated function systems (IFS) giving new insights into the dynamics of wealth accumulation in such models. In particular, we focus on the "yard-sale" (winner gets a random…

Statistical Mechanics · Physics 2009-11-10 Sitabhra Sinha