Simulation of a generalized asset exchange model with investment and income mechanisms

TL;DR

This paper extends an agent-based economic model by adding investment and income mechanisms, resulting in realistic wealth distributions and demonstrating non-equilibrium steady states driven by multiplicative noise.

Contribution

It introduces a generalized asset exchange model with investment and guaranteed income, capturing realistic wealth distributions and non-equilibrium dynamics.

Findings

Wealth distributions match empirical data.

Gini coefficients and Pareto indices are realistic.

System reaches steady state but remains out of thermal equilibrium.

Abstract

An agent-based model of the economy is generalized to incorporate investment and guaranteed income mechanisms in addition to the exchange and distribution mechanisms considered in earlier models. We find realistic wealth distributions and realistic values of the Gini coefficients and the Pareto index. We also show that although the system reaches a steady state, the system is not in thermal equilibrium. The nonequilibrium behavior is associated with the multiplicative noise generated by the investment mechanism.