ECO 320v: Computable Economics Sam Reisz Jordan Fox Joshua Carpenter

We will be using the Wealth distribution model as a way to implement the concept of inheritance. Our curiosity for the idea of inheritance spawns from the oft seen passing down of money through generations. In many situations, individuals are wealthy not because of what they themselves have done, but rather because of the passing of familial wealth. Through the Netlogo model, we plan on giving newly spawned turtles the ability to inherit the wealth of the previous turtles parent. This inheritance concept would only affect the newly created cell when the parent cell has reached their maximum life span. Inheritance would not affect the cells where a turtle has died because they ran out of grain, due to the fact that there will be no grain to inherit. We have also added two other dimensions to the experiment. First, the metabolism will be set to vary. This will allow us to test and see whether the rate at which each class consumes has any effect on the gini-coefficient. Also, we have reprogrammed the model so that the turtles are not dependent upon their neighbors to move. Now they move in the four directions of allowance randomly. Along with testing inheritance and varying metabolism, we will also have two other treatment factors vary. And as well, we expect to find patterns with these other treatment factors. The other treatment factors that we will be testing are vision and number of grain grown. The hypothesis: If new turtles are able to inherit the previous wealth of their parent, then the inequality of wealth will be the greatest when metabolism is at its lowest, vision is at its highest and number of grain grown is at its highest. By varying each of these factors, we will be able to see the effect that each value of the given variable and combinations of them may have on the gini-coefficient. This will be vital in our analysis and likely lead to additional conclusions not in our hypothesis. We have created this theory based on the ability of new turtles to stockpile wealth between generations. There is a global assumption that the rich consume a lesser proportion of their expendable income than the under-classes do. Thus increasing their savings and consequently increasing wealth. This could be a piece of the explanation for the very large disproportion between the rich and poor. Reporting Results In order for our hypothesis to be tested we must first develop values for the counterparts that can be verified by the data drawn from the experiment we perform. Therefore, new turtles must be able to inherit their parents wealth after their parent has died, or the structural feature inherit must be set equal to True. Second, we must specify that the largest over-all differential between classes will be when metabolism is at its lowest, vision is at its highest and number-grain-grown is at its highest. Let the treatment factors be defined as: c = Gini-Coefficient v = Vision g = Number-grain-grown m = Metabolism And a function of the gini-coefficient:

 = (, , ) Let the ideal values be defined as: Max-vision = Vmax Max-grain-grown = Gmax Min-metabolism = mmin Max-Gini-Coefficient = Optimizing the gini-coefficient function: | = f V max , Gmax , mmin = f V max , Gmax , mmin = f V max , Gmax , mmin

We define our null hypothesis and test it with the raw data from our experiment. H0: H1:

Essentially, out of the 30 runs, we want to find the combination: Gini-Coefficient Vision 15 Grain-Grown 10 Metabolism 1

The maximum gini-coefficient, , is that of all other gini-coefficients in the experiment. The results were surprising. We found that the maximum gini-coefficient of our experiment came during the 8th run with the value, = 0.630894189. This part of the null hypothesis holds true. Further in the data though we see that other values arent where we expected. Vision is at its lowest, Grain-Grown is at mid-interval and Metabolism is at mid-interval.

If we expand the hypothesis and view the top five runs we find the surprising results. The following table gives a summary of the top and bottom five values of the gini-coefficient and the level of the treatment factors at that period in time:

Run #8 #1 #12 #2 #6

Top Five 1 2 3 4 5

Gini-Coefficient 0.630894189 0.622832067 0.612047308 0.566106107 0.554769622

Vision 1 1 1 1 1

Grain-Grown 5 1 10 1 5

Metabolism 14 1 14 1 1

Run #29 #30 #20 #22 #18

Bottom Five 30 29 28 27 26

Gini-Coefficient 0.154447984 0.159194854 0.179897900 0.190644613 0.196794208

Vision 11 11 6 6 6

Grain-Grown 5 5 10 10 5

Metabolism 1 1 1 1 1

= f V max , Gmax , mmin

Since the maximum gini-coefficient doesnt happen at:

We fail to reject the null hypothesis. Analysis of the Findings

Treatment Factor Value Report

The treatment factors that vary: Metabolism Num-Grain-Grown Vision Fixed values: Life-expectancy-min Life-expectancy-max Grain-growth-interval Percent-best-land 1 83 6 10 1 1 1 13 5 8 25 10 15

test 10/22/2009 16:36:07:568 -0400 min-pxcor max-pxcor min-pycor max-pycor -25 25 -25 25
Run # inherit life-exp-min life-exp-max vision grn-grwn grn-grwth-int %-bst-Lnd

1 2 3 4 5 6 7

TRUE TRUE TRUE TRUE TRUE TRUE TRUE

1 1 1 1 1 1 1

83 83 83 83 83 83 83

1 1 1 1 1 1 1

1 1 1 1 5 5 5

8 8 8 8 8 8 8

10 10 10 10 10 10 10

8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE TRUE

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83 83

1 1 1 1 1 6 6 6 6 6 6 6 6 6 6 6 6 11 11 11 11 11 11

5 10 10 10 10 1 1 1 1 5 5 5 5 10 10 10 10 1 1 1 1 5 5

8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8

10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10

Run #

metabolism

# ppl

[step]

gini-coeff

the-seed

Std-Dev

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

1 1 14 14 1 1 14 14 1 1 14 14 1 1 14 14 1 1

250 250 250 250 250 250 250 250 250 250 250 250 250 250 250 250 250 250

100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100

0.622832067 0.566106107 0.440682716 0.420120154 0.478673134 0.554769622 0.50497552 0.630894189 0.479557715 0.480010085 0.512119288 0.612047308 0.294942547 0.279598848 0.399656184 0.392575566 0.225383258 0.196794208

-3.06419E+15 2.66023E+15 -7.57058E+15 -6.17568E+15 -5.94196E+15 3.18137E+15 4.75641E+14 -6.45686E+15 -5.49949E+14 -1.5088E+15 3.28608E+14 5.81065E+15 8.55834E+15 4.73094E+15 -4.23465E+15 3.23571E+15 4.20535E+15 6.44056E+15

8.90E-16 1.00E-15 2.78E-15 1.39E-15 1.78E-15 2.56E-15 1.22E-15 1.22E-15 9.46E-16 1.11E-15 2.00E-15 2.67E-15 1.78E-15 8.34E-16 1.33E-15 1.33E-15 1.95E-16 4.17E-16

19 20 21 22 23 24 25 26 27 28 29 30

14 14 1 1 14 14 1 1 14 14 1 1

250 250 250 250 250 250 250 250 250 250 250 250

100 100 100 100 100 100 100 100 100 100 100 100

0.502084109 0.512587848 0.1798979 0.190644613 0.524434996 0.5197689 0.28274441 0.26124385 0.37082874 0.397968425 0.154447984 0.159194854

-6.54923E+14 -1.2435E+15 -1.38871E+15 3.00095E+15 3.91973E+15 6.29865E+15 -8.25909E+15 2.23466E+15 5.27403E+15 2.85437E+15 4.47477E+15 2.04986E+15

2.45E-15 1.22E-15 4.45E-16 8.34E-16 2.89E-15 1.89E-15 2.22E-16 1.06E-15 1.22E-15 3.34E-16 1.95E-16 5.01E-16

0.7 0.6 0.5 0.4 0.3 0.2 0.1 0

Gini-Coefficient

Gini-Coefficient

11

13

15

17

19

21

23

25

27

29

Standard Deviation of the GiniCoefficient

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30