Application of Chaotic Number Generators in Econophysics

Agent-based models have demonstrated their power and flexibility in Econophysics. However their major challenge is still to devise more realistic simulation scenarios. The complexity of Economy makes appealing the idea of introducing chaotic number generators as simulation engines in these models. Chaos based number generators are easy to use and highly configurable. This makes them just perfect for this application.

Money Distributions in Chaotic Economies

This paper considers the ideal gas-like model of trading markets, where each individual is identified as a gas molecule that interacts with others trading in elastic or money-conservative collisions. Traditionally this model introduces different rules of random selection and exchange between pair agents. Real economic transactions are complex but obviously non-random. Consequently, unlike this traditional model, this work implements chaotic elements in the evolution of an economic system. In particular, we use a chaotic signal that breaks the natural pairing symmetry $(i,j)\Leftrightarrow(j,i)$ of a random gas-like model. As a result of that, it is found that a chaotic market like this can reproduce the referenced wealth distributions observed in real economies (the Gamma, Exponential and Pareto distributions).