Nonlocal Reaction–Diffusion Models of Heterogeneous Wealth Distribution

Models of the Distribution of Wealth

In this paper we review some of the computable general equilibrium models based on unin-surable shocks to earnings that can be used to account for diierences in wealth holdings across households. We explore their ability to generate the key properties of the data (which we summarize by (a) a very small amount of wealth among the poorest 40% of the population (about 2% of total wealth), (b) a ve...

Asset Pricing and Wealth Distribution with Heterogeneous Investment Returns

I obtain a closed-form solution for a general equilibrium model with incomplete markets and heterogeneous agents that allow for an arbitrary number of assets, an arbitrary number of aggregate states, and arbitrary shock distributions for asset returns. Agent heterogeneity has non-trivial implications for asset prices and risk premia. In a stationary equilibrium the conditional distribution of c...

Kinetic theory models for the distribution of wealth

Various multi-agent models of wealth distributions defined by microscopic laws regulating the trades, with or without a saving criterion, are reviewed. We discuss and clarify the equilibrium properties of the model with a constant global saving propensity, resulting in Gamma distributions, and their equivalence to the Maxwell-Boltzmann kinetic energy distribution in an effective number of dimen...

Wealth distribution of simple exchange models coupled with extremal dynamics

Punctuated Equilibrium (PE) states that after long periods of evolutionary quiescence, species evolution can take place in short time intervals, where sudden differentiation makes new species emerge and some species extinct. In this paper, we introduce and study the effect of punctuated equilibrium on two different asset exchangemodels: the yard sale model (YS, winner gets a random fraction of ...

Distribution of Wealth