Journal of Evolutionary Economics

, Volume 26, Issue 1, pp 25–47 | Cite as

Increasing inequality, consumer credit and financial fragility in an agent based macroeconomic model

  • Alberto RussoEmail author
  • Luca Riccetti
  • Mauro Gallegati
Regular Article


We investigate the interplay between increasing inequality and consumer credit in a complex macroeconomic system with financially fragile heterogeneous households, firms and banks. Simulation results show that there are pros and cons of introducing consumer credit: on the one hand, for a certain time, it leads to lower unemployment through boosting aggregate demand; on the other hand, it accelerates the system tendency to the crisis. Since the increase of financial profits goes with a decline of households’ real wealth, a policy trade-off emerges.


Consumer credit Inequality Agent-based macroeconomics Business cycle Profit rate Crisis Unemployment 

JEL Classification

C63 D31 E21 E32 


Acknowledgments and compliance with ethical rules

We are very grateful to the participants at EMAEE2013 held at the SKEMA Business School, Sophia Antipolis, Nice (France), on June 10-12, 2013, for useful comments and suggestions. We are indebted to two anonymous referees for valuable comments and suggestions. The authors declare that they have no conflict of interest. The research does not involve human participants and/or animals.

Supplementary material

191_2015_410_MOESM1_ESM.tex (72 kb)
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Copyright information

© Springer-Verlag Berlin Heidelberg 2015

Authors and Affiliations

  1. 1.Department of Economics and Social SciencesUniversità Politecnica delle MarcheAnconaItaly
  2. 2.Sapienza Università di RomaRomaItaly

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