Evolution of the distribution of wealth in an economic environment driven by local Nash equilibria (Q2016547)

The authors present and analyze a kinetic model of rational agents which interact by exchanging wealth and evolve slowly in an economic configuration space as a result of fast trading exchanges. Each agent bases his decisions on minimizing a cost functional. This results in a redistribution of wealth which drives the system towards a Nash equilibrium. The authors consider general cost functions while the literature is mostly concerned with quadratic cost functions. On large scales, this gives a hydrodynamic-like model for the agent and wealth densities, which leads to a closed system in the case of a quadratic cost function. The inverse gamma distribution is recovered as an equilibrium in the particular case of quadratic cost functions.