Related papers: Equal opportunities lead to maximum wealth inequal…
We present a macroeconomic agent-based model that combines several mechanisms operating at the same timescale, while remaining mathematically tractable. It comprises enterprises and workers who compete in a job market and a commodity goods…
We point out a simple equities trading strategy that allows a sufficiently large, market-neutral, quantitative hedge fund to achieve outsized returns while simultaneously contributing significantly to increasing global wealth inequality.…
Ergodicity economics is a new branch of economic theory that notes the conceptual difference between time averages and expectation values, which coincide only for ergodic observables. It postulates that individual agents maximise the time…
Predictive algorithms are now used to help distribute a large share of our society's resources and sanctions, such as healthcare, loans, criminal detentions, and tax audits. Under the right circumstances, these algorithms can improve the…
We study the fair allocation of indivisible goods with variable groups. In this model, the goal is to partition the agents into groups of given sizes and allocate the goods to the groups in a fair manner. We show that for any number of…
The Rashomon set of equally-good models promises less discriminatory algorithms, reduced outcome homogenization, and fairer decisions through model ensembles or reconciliation. However, we argue from the perspective of allocation…
Fair allocation of indivisible goods studies allocating $m$ goods among $n$ agents in a fair manner. While fairness is a fundamental requirement in many real-world applications, it often conflicts with (economic) efficiency. This raises a…
Recently, in order to explore the mechanism behind wealth or income distribution, several models have been proposed by applying principles of statistical mechanics. These models share some characteristics, such as consisting of a group of…
Microscopic models describing a whole of economic interactions in a closed society are considered. The presence of a tax system combined with a redistribution process is taken into account, as well as the occurrence of tax evasion. In…
The advent of powerful prediction algorithms led to increased automation of high-stake decisions regarding the allocation of scarce resources such as government spending and welfare support. This automation bears the risk of perpetuating…
Participants in socio-economic systems are often ranked based on their performance. Rankings conveniently reduce the complexity of such systems to ordered lists. Yet, it has been shown in many contexts that those who reach the top are not…
This paper develops a new model of business cycles. The model is economical in that it is solved with an aggregate demand-aggregate supply diagram, and the effects of shocks and policies are obtained by comparative statics. The model builds…
This paper presents a model of the dynamics of the wage income distribution.
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…
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…
The "Money Exchange Model" is a type of agent-based simulation model used to study how wealth distribution and inequality evolve through monetary exchanges between individuals. The primary focus of this model is to identify the limiting…
A group of agents each exert effort to produce a joint output, with the complementarities between their efforts represented by a (weighted) network. Under equity compensation, a principal motivates the agents to work by giving them shares…
Picking sequences are well-established methods for allocating indivisible goods. Among the various picking sequences, recursively balanced picking sequences -- whereby each agent picks one good in every round -- are notable for guaranteeing…
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…
We study the most famous example of a large financial market: the Arbitrage Pricing Model, where investors can trade in a one-period setting with countably many assets admitting a factor structure. We consider the problem of maximising…