Competition and investment model of wealth distribution

This study proposes and analyzes a unified model that integrates pairwise competition and individual investment via an adjustable parameter. Numerical simulations are conducted to analyze the model’s Gini coefficient and distributional shapes using the complementary cumulative distribution function and goodness-of-fit tests. Results show that the model captures a systematic transition in the bulk distribution from gamma like to log-normal like. Additionally, intermediate levels of mechanism mixing can reduce inequality compared with the original mechanisms. However, it is difficult to distinguish heavy tails consistent with power-laws from log-normal tails. These findings highlight the importance of considering the interaction between different economic mechanisms but suggest that accurately replicating the empirical power-law tail requires more than the simple combination investigated.