The aim of this paper is to investigate the relationship between increasing inequality and financial fragility in an agent based macroeconomic model. We analyse the effects of a non-linear relationship between wealth and consumption on the evolution of the economic system. Preliminary results show that more inequality rises macroeconomic volatility, increasing the likelihood of observing large unemployment crises.

Increasing Inequality and Financial Fragility in an An Agent Based Macroeconomic Model

RUSSO, Alberto;RICCETTI, LUCA;GALLEGATI, Mauro
2013

Abstract

The aim of this paper is to investigate the relationship between increasing inequality and financial fragility in an agent based macroeconomic model. We analyse the effects of a non-linear relationship between wealth and consumption on the evolution of the economic system. Preliminary results show that more inequality rises macroeconomic volatility, increasing the likelihood of observing large unemployment crises.
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11566/145898
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