Open AccessIrreversibility of change in a model of boundedly rational agents exchanging goods and capital
Author(s) -
Takuma Tanaka
Publication year - 2020
Publication title -
journal of physics communications
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.407
H-Index - 17
ISSN - 2399-6528
DOI - 10.1088/2399-6528/ab8f00
Subject(s) - microeconomics , economics , rational agent , preference , production (economics) , capital (architecture) , rationality , capital good , mathematical economics , public good , neoclassical economics , archaeology , political science , law , history
This paper investigates the direction of change in a model of agents exchanging goods and capital. Agents have heterogeneous utility functions and are not perfectly rational but can refuse exchanges that decrease their own utility. In this model, an exchange is shown to always increase a quantity defined by the amount of production and the time preference of the agents.