Wealth Rheology

Entropy (Basel). 2021 Jun 30;23(7):842. doi: 10.3390/e23070842.

Abstract

We study wealth rank correlations in a simple model of macroeconomy. To quantify rank correlations between wealth rankings at different times, we use Kendall's τ and Spearman's ρ, Goodman-Kruskal's γ, and the lists' overlap ratio. We show that the dynamics of wealth flow and the speed of reshuffling in the ranking list depend on parameters of the model controlling the wealth exchange rate and the wealth growth volatility. As an example of the rheology of wealth in real data, we analyze the lists of the richest people in Poland, Germany, the USA and the world.

Keywords: Bouchaud–Mézard model; Gini coefficient; rank correlations; wealth distribution; wealth inequality.