Extended Yard Sale model of wealth distribution on Erdős-Rényi random networks

Abstract

Excessive wealth concentration can undermine economic and social development. Random Asset Exchange (RAE) models provide valuable tools to investigate this phenomenon. Assuming that economic systems may operate optimally near the critical point of a continuous phase transition, the Extended Yard Sale (EYS) model introduced by Boghosian et al.~[Physica A 476, 15 (2017)] offers a compelling framework. This model captures the interplay between wealth redistribution and accumulation, exhibiting a continuous phase transition marked by a broad wealth distribution at criticality, separating a condensed phase -- where a microscopic fraction of agents holds a macroscopic share of total wealth -- from a distributed phase with a light-tailed wealth distribution. While the original EYS model assumes fully connected interactions, this work introduces and studies a networked variant where agents interact over Erdős-Rényi random networks. The analysis combines Monte Carlo simulations with Quenched Mean Field and Mean Field approximations, exploring a variety of interaction and taxation schemes. A scaling analysis shows that, although the networked model also undergoes a continuous phase transition, it leads to local wealth condensation rather than the global condensation found in the fully connected case. These results deepen our understanding of wealth dynamics in structured populations and may help inform the development of more effective economic and social policies.

arXiv comment15 pages and 10 figures

References in corpus (23)

• Emergence of scaling in random networks
• Epidemic processes in complex networks
• Structure and tie strengths in mobile communication networks
• Emergent complex neural dynamics
• Are biological systems poised at criticality?
• Colloquium: Criticality and dynamical scaling in living systems
• Statistical mechanics of money
• Colloquium: Statistical mechanics of money, wealth, and income
• Wealth Distributions in Models of Capital Exchange
• Pareto Law in a Kinetic Model of Market with Random Saving Propensity
• Distributions of money in model markets of economy
• Critical fluctuations in proteins native states
• The Kinetics of Wealth and the Origin of the Pareto Law
• Correlation between Risk Aversion and Wealth distribution
• Emergent self-organized complex network topology out of stability constraints
• An $H$ theorem for Boltzmann's equation for the Yard-Sale Model of asset exchange
• Statistical Mechanics of maximal independent sets
• Fokker-Planck Description of Wealth Dynamics and the Origin of Pareto's Law
• Optimal risk in wealth exchange models: agent dynamics from a microscopic perspective
• Yard-Sale exchange on networks: Wealth sharing and wealth appropriation
• Mean-field theory of an asset exchange model with economic growth and wealth distribution
• Scaling in local to global condensation of wealth on sparse networks
• Analysis of the inference of ratings and rankings in complex networks using discrete exterior calculus on higher--order networks