The paper Wealth Inequality and Social Mobility: A Simulation-Based Modelling Approach by Yang Xiaoliang, a young researcher at the School of Public Finance and Taxation and a research fellow at IIDPF, has been officially accepted by the prestigious journal The Journal of Economic Behavior and Organization.
This study designs a series of numerical simulation-based thought experiments to deductively assess the causal effects of various factors on wealth inequality (distribution) and social mobility (dynamics of distribution). The experiments show that uncertainty itself can lead to natural inequality; while factors associated with asset returns can lead to greater inequality than those associated with labour returns. Based on the above experimental structure, the paper constructs a fusion-based ABM model (hybrid agent-based model) to match the observed indicators of wealth inequality in the G7 countries and China. The structurally estimated model simulates the production of a power-law distribution of the rich and a Gatsby curve with a positive slope depicting the relationship between intra-generational mobility and inequality. In addition, the paper investigates how this ABM model can be extended to broader issues such as the redistributive effects of taxation and finance.
Journal of Economic Behavior and Organization is recognized as an authoritative journal in the field of economics by universities and research institutions in China, mainly publishing research results in the field of behavioral economics.
Dr Xiaoliang Yang graduated from Cardiff University with research interests in macroeconomic modelling, applied macroeconometrics, and numerical simulation modeling, and his research expertise includes the areas of economic growth, inequality and redistribution.