Berlin 2024 – scientific programme
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SOE: Fachverband Physik sozio-ökonomischer Systeme
SOE 7: Poster
SOE 7.9: Poster
Monday, March 18, 2024, 18:00–20:30, Poster D
Emergent inequalities in a primitive agent-based good-exchange model — •Nirbhay Patil1,2, Jean-Pierre Nadal1,3, and Jean-Philippe Bouchaud2,4 — 1Ecole Normale Superieure, Paris — 2Chair Econophysix, Ecole Polytechnique, Massy-Palaisseau — 3École des hautes études en sciences sociales, Paris — 4Capital Fund Management, Paris
Rising inequalities around the globe bring into question our economic systems, and the source of these inequalities. Here we try to understand the economy using an agent-based model where each entity is simultaneously producing and consuming goods, like a farmer or a firm.
To optimize utility, agents buy products in decreasing order of utility per unit price till they buy everything they can. Utilities are drawn from random distributions to reflect personal tastes and convenience. To optimise sales, agents adjust prices by comparing supply and demand. This is a complete description of the model, which we then simplify in various ways to make it analytically tractable. We come up with ways to find the stability of the resulting system that constitutes a new ensemble of random matrices not studied before.
We find that the system exhibits a phase transition between states of equality and strong inequalities based on the production capacity of each person. For higher production values this society becomes extremely unequal. We explore ways to alleviate poverty in this model and whether they have real life significance.
Keywords: Agents; Economics; Matrices; Phase Transition; Inequalities