We discuss the wealth condensation mechanism in a simple toy economy in which individual agent's wealths are distributed according to a Pareto power law and the overall wealth is fixed. The observed behaviour is the manifestation of a transition which occurs in Zero Range Processes (ZRPs) or "balls in boxes" models. An amusing feature of the transition in this context is that the condensation can be induced by increasing the exponent in the power law, which one might have naively assumed penalised greater wealths more.
|Number of pages||9|
|Journal||Acta Physica Polonica B|
|Publication status||Published - Sep 2005|
|Event||Conference on Applications of Random Matrices to Economy and Other Complex Systems - Cracow, Poland|
Duration: 25 May 2005 → 28 May 2005