Abstract
Econophysicists have demonstrated that the physical dynamics of monetary trade systems result in a money distribution equal to 0.5 Gini coefficient. This occurs in efficient trade systems where all agents have equal ability and opportunity. The implication is that a market economy does not distribute money based on merit. The Toy Trader model is introduced, and experiments performed are designed to explore this finding and how different trade aspects might impact money distribution.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Boltzmann, L. (1965). Lectures on gas theory. American Journal of Physics, 33(11), 974–975.
Davies, J. B., & Shorrocks, A. F. (2000). The distribution of wealth. Handbook of income distribution, 1, 605–675.
Dragulescu, A., & Yakovenko, V. M. (2000). Statistical mechanics of money. The European Physical Journal B-Condensed Matter and Complex Systems, 17(4), 723–729.
Friedman, M., & Schwartz, A. J. (1969). The definition of money: Net wealth and neutrality as criteria. Journal of Money, Credit and Banking, 1(1), 1–14.
Gallegati, M., Keen, S., Lux, T., & Ormerod, P. (2006). Worrying trends in econophysics. Physica A: Statistical Mechanics and its Applications, 370(1), 1–6.
Galor, O., & Zeira, J. (1993). Income distribution and macroeconomics. The Review of Economic Studies, 60(1), 35–52.
Graziani, A. (1996). Money as purchasing power and money as a stock of wealth in Keynesian economic thought. In G. Deleplace & E. J. Nell (Eds.), Money in motion (pp. 139–154). Houndmills, Basingstoke and London, UK: Palgrave Macmillan.
Kaufman, G. G. (1969). More on an empirical definition of money. The American Economic Review, 59(1), 78–87.
Keister, L. A. (2000). Wealth in America: Trends in wealth inequality. Cambridge: Cambridge University Press.
Kohler, T. A., Smith, M. E., Bogaard, A., Feinman, G. M., Peterson, C. E., Betzenhauser, A., ... & Ellyson, L. J. (2017). Greater post-Neolithic wealth disparities in Eurasia than in North America and Mesoamerica. Nature, nature24646.
Kuznets, S. (1955). Economic growth and income inequality. The American Economic Review, 45(1), 1–28.
Milanovic, B. (2005). Worlds Apart: Measuring global and international inequality. Retrieved March 8, 2011, from http://siteresources.worldbank.org/INTPOVRES/Resources/477227-1142020443961/Module5_chap9_10.pdf.
Milanovic, B. (2012). Global income inequality by the numbers: In history and now—An overview (Policy Research Working Paper 6259). The World Bank Development Research.
Piketty, T. (2015). About. American Economic Review, 105(5), 48–53. https://doi.org/10.1257/aer.p20151060.
Wannier, G. H. (1987). Statistical physics. New York: Dover.
Wilensky, U., & Rand, W. (2015). An introduction to agent-based modeling: Modeling natural, social, and engineered complex systems with Netlogo. Cambridge: MIT Press.
Yakovenko, V. M. (2016). Monetary economics from econophysics perspective. arXiv preprint arXiv:1608.04832.
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2019 The Author(s)
About this chapter
Cite this chapter
Gooding, T. (2019). Money Distribution. In: Economics for a Fairer Society. Palgrave Pivot, Cham. https://doi.org/10.1007/978-3-030-17020-2_8
Download citation
DOI: https://doi.org/10.1007/978-3-030-17020-2_8
Published:
Publisher Name: Palgrave Pivot, Cham
Print ISBN: 978-3-030-17019-6
Online ISBN: 978-3-030-17020-2
eBook Packages: Economics and FinanceEconomics and Finance (R0)