Introducing Chaos in Economic Gas-like Models

TL;DR

This paper explores how introducing chaos into gas-like trading models causes a transition from Gibbs to Pareto money distributions, highlighting the impact of symmetry breaking on market behavior.

Contribution

It presents a novel chaotic procedure for agent pairing in gas-like market models, demonstrating its effect on the resulting money distribution.

Findings

Chaotic pairing breaks symmetry in agent interactions.

Distribution transitions from Gibbs to Pareto with increased chaos.

Chaos influences market inequality and wealth distribution.

Abstract

This paper considers ideal gas-like models of trading markets, where each agent is identified as a gas molecule that interacts with others trading in elastic or money-conservative collisions. Traditionally, these models introduce different rules of random selection and exchange between pair agents. Unlike these traditional models, this work introduces a chaotic procedure able of breaking the pairing symmetry of agents (i,j)->(j,i). Its results show that, the asymptotic money distributions of a market under chaotic evolution can exhibit a transition from Gibbs to Pareto distributions, as the pairing symmetry is progressively broken.