Related papers: Economic Inequality: Is it Natural?
We analyze three sets of income data: the US Panel Study of Income Dynamics PSID), the British Household Panel Survey (BHPS), and the German Socio-Economic Panel (GSOEP). It is shown that the empirical income distribution is consistent with…
In the so-called ``fair'' models of peer-to-peer wealth exchanges, economic inequality tends to reach its maximum value asymptotically. This global trend is evident as the richest continuously accumulate a larger share of wealth at the…
This paper presents a model of the dynamics of the wage income distribution.
We propose a highly schematic economic model in which, in some cases, wage inequalities lead to higher overall social welfare. This is due to the fact that high earners can consume low productivity, non essential products, which allows…
We show that there is a common mode of origin for the power laws observed in two different models: (i) the Pareto law for the distribution of money among the agents with random saving propensities in an ideal gas-like market model and (ii)…
We explore the role of non-ergodicity in the relationship between income inequality, the extent of concentration in the income distribution, and mobility, the feasibility of an individual to change their position in the income distribution.…
In this short paper, we overview and extend the results of our papers cond-mat/0001432, cond-mat/0008305, and cond-mat/0103544, where we use an analogy with statistical physics to describe probability distributions of money, income, and…
Measures of economic mobility represent aggregate values for how individual wealth changes over time. As such, these measures may not describe the feasibility of a typical individual to change their wealth. To address this limitation, we…
A common assumption of political economy is that profit rates across firms or sectors tend to uniformity, and often models are formulated in which this tendency is assumed to have been realised. But in reality this tendency is never…
The evolution of global income distribution from 1988 to 2018 is analyzed using purchasing power parity exchange rates and well-established statistical distributions. This research proposes the use of two separate distributions to more…
We investigate the unbiased model for money exchanges: agents give at random time a dollar to one another (if they have one). Surprisingly, this dynamics eventually leads to a geometric distribution of wealth (shown empirically by…
Each individual in society experiences an evolution of their income during their lifetime. Macroscopically, this dynamics creates a statistical relationship between age and income for each society. In this study, we investigate income…
Various formulations of counterfactual general equilibrium in economies -- systems of actors manipulating economic goods -- are logically and mathematically analyzed. Evenly-rotating economies are systems whose evolution is stable, steady,…
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…
This paper explores several types of income which have not been explored so far by authors who tackled income and wealth distribution using Statistical Physics. The main types of income we plan to analyze are income before redistribution…
This paper proposes a statistical mechanics approach to the analysis of income distribution and inequality. A new distribution function, having its roots in the framework of k-generalized statistics, is derived that is particularly suitable…
This paper presents an empirical application of the Gause-Witt model of population ecology and ecosystems to the income distribution competitive dynamics of social classes in economic systems. The Gause-Witt mathematical system of coupled…
Understanding the statistical dynamics of growth and inequality is a fundamental challenge to ecology and society. Recent analyses of wealth and income dynamics in contemporary societies show that economic inequality is very dynamic and…
The power law is ubiquitous in natural and social phenomena, and is considered as a universal relationship between the frequency and its rank for diverse social systems. However, a general model is still lacking to interpret why these…
The personal income distribution (PID) above the Pareto threshold is studied and modeled. A microeconomic model is proposed to simulate the PID and its evolution below and above the Pareto income threshold. The model balances processes of…