CAPITAL REDISTRIBUTION BRINGS WEALTH BY PARRONDO'S PARADOX

Capital Redistribution Brings Wealth By Parrondo's Paradox

Capital Redistribution Brings Wealth by Parrondo’s Paradox

We present new versions of the Parrondo’s paradox by which a losing game can be turned into winning by including a mechanism that allows redistribution of the capital amongst an ensemble of players. This shows that, for this particular class of games, redistribution of the capital is beneficial for everybody. The same conclusion arises when the redistribution goes from the richer players to the...

Parrondo’s paradox via redistribution of wealth∗

In Toral’s games, at each turn one member of an ensemble of N ≥ 2 players is selected at random to play. He plays either game A′, which involves transferring one unit of capital to a second randomly chosen player, or game B, which is an asymmetric game of chance whose rules depend on the player’s current capital, and which is fair or losing. Game A′ is fair (with respect to the ensemble’s total...

Analysis of a Model for Wealth Redistribution

This paper provides a detailed analytical investigation of a kinetic model for the redistribution of wealth in a simple economy, which was proposed by Chakrabarti, Chatterjee and Manna. Estimates on the rate of convergence towards the steady state are derived, both for the finite-agent model, found in Monte-Carlo simulations, and the continuous model, corresponding to a homogeneous Boltzmann eq...

On the Formation of Capital and Wealth

We show modern information technology (in short IT) is the cause of rising income and wealth inequality since the 1970's and has contributed to slow growth of wages and decline in the natural rate. Hence, the source of most improvements in our living standards also causes social losses and rising inequality. We first study all US firms whose securities trade on public exchanges. Surplus wealth ...