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Wealth condensation as a zero range process

Johnston, D (Heriot-Watt)
Thursday 16 February 2006, 11:00-12:00

Seminar Room 2, Newton Institute Gatehouse


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 manisfestation 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 {\it increasing} the exponent in the power law, which one might have naively assumed penalized greater wealths more.


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