Pareto Law in a Kinetic Model of Market with Random Saving Propensity

@article{Chatterjee2004ParetoLI,
  title={Pareto Law in a Kinetic Model of Market with Random Saving Propensity},
  author={A. Chatterjee and B. Chakrabarti and S. S. Manna},
  journal={Physica A-statistical Mechanics and Its Applications},
  year={2004},
  volume={335},
  pages={155-163}
}
  • A. Chatterjee, B. Chakrabarti, S. S. Manna
  • Published 2004
  • Physics, Economics, Mathematics
  • Physica A-statistical Mechanics and Its Applications
  • We have numerically simulated the ideal-gas models of trading markets, where each agent is identified with a gas molecule and each trading as an elastic or money-conserving two-body collision. Unlike in the ideal gas, we introduce (quenched) saving propensity of the agents, distributed widely between the agents (0⩽λ<1). The system remarkably self-organizes to a critical Pareto distribution of money P(m)∼m−(ν+1) with ν≃1. We analyze the robustness (universality) of the distribution in the model… CONTINUE READING
    216 Citations
    Ideal Gas-Like Distributions in Economics: Effects of Saving Propensity
    • 26
    • PDF
    On Steady Distributions of Kinetic Models of Conservative Economies
    • 85
    • Highly Influenced
    • PDF
    Ideal-Gas Like Markets: Effect of Savings
    • 6
    • PDF

    References

    SHOWING 1-9 OF 9 REFERENCES
    DISTRIBUTIONS OF MONEY IN MODEL MARKETS OF ECONOMY
    • 89
    • PDF
    Follow the Money
    • 203
    • PDF
    How Nature Works
    • 1,883