# Money in Gas-Like Markets: Gibbs and Pareto Laws

## Author Info

• Arnab Chatterjee
• Bikas K. Chakrabarti
• S. S. Manna
Registered author(s):

## Abstract

We consider the ideal-gas models of trading markets, where each agent is identified with a gas molecule and each trading as an elastic or money-conserving (two-body) collision. Unlike in the ideal gas, we introduce saving propensity $\lambda$ of agents, such that each agent saves a fraction $\lambda$ of its money and trades with the rest. We show the steady-state money or wealth distribution in a market is Gibbs-like for $\lambda=0$, has got a non-vanishing most-probable value for $\lambda \ne 0$ and Pareto-like when $\lambda$ is widely distributed among the agents. We compare these results with observations on wealth distributions of various countries.

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File URL: http://arxiv.org/pdf/cond-mat/0311227

## Bibliographic Info

Paper provided by arXiv.org in its series Papers with number cond-mat/0311227.

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 Length: Date of creation: Nov 2003 Date of revision: Publication status: Published in Physica Scripta T106 (2003) 36-38 Handle: RePEc:arx:papers:cond-mat/0311227 Contact details of provider: Web page: http://arxiv.org/

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