Abstract
Historical data, theory and computer simulations support a connection between growth and economic inequality. Our present world with large regional differences in economic activity is a result of fast economic growth during the last two centuries. Because of limits to growth we might expect a future world to develop differently with far less growth. The question that we here address is: “Would a world with a sustainable economy be less unequal?” We then develop integrated spatial economic models based on limited resources consumption and technical knowledge accumulation and study them by the way of computer simulations. When the only coupling between world regions is diffusion we do not observe any spatial unequality. By contrast, highly localized economic activities are maintained by global market mechanisms. Structures sizes are determined by transportation costs. Wide distributions of capital and production are also predicted in this regime.
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Notes
According to Gell-Mann, the use of very simple assessment models, the Crude Look At the Whole, is well adapted to policy makers who don’t care about details.
When firms invest in production rather than in buying stock, part of the capital decreases in time because for instance of machines maintenance.
The scheme also allows to predict the possible emergence of “dissipative structures” in space [13]: a constant influx of energy is dissipated after going through intermediate stages including positive loops involved in the production process.
This expression from economics simply means that production scales linearly with the productions factors K and C: a firm with twice as much capital using twice as much resource has a twice as much output.
Since production is a concave function with respect to C, a positive profit is only made when production increases faster than cost for low values of C. p<A is then a necessary condition for a positive profit. The expressions obtained under the assumption A 0≫p remain valid for a large price domain as checked by numerical simulations.
In fluctuating economic conditions, a customer never knows precisely whether her order to a provider will be delivered. She then distributes orders to different providers to minimise risks. This is often described by economists as the exploration/exploitation compromise: exploit available knowledge about best providers but keep on exploring other possibilities.
Actual profit could be a rational choice for attractivity. We already said that in noisy environments, actors rather guide their choice on a moving average of profit upon characteristic time \(\frac{1}{\delta_{K}}\), which is precisely K according to Eq. (3).
Noisy environments induce losses when resources are not delivered. Checking more expensive non-local providers for supply is an insurance against such losses; β is thus related to the cost of these failures of delivery.
Since some variables also take 0 values they are translated by 0.1 to figure on the log-log plot.
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Acknowledgements
We thank Markus Brede, Adrian Carro, Bernard Derrida, Roger Guesnerie, Alan Kirman, Yoram Louzoun, Hubertus de Vries and Bin Xu for helpful discussions and suggestions. We thank referees for raising interesting and important issues.
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Appendix
Appendix
We here report the results of numerical tests to check the meta-stability of the observed patterns, possible scaling effects and the role of initial configurations.
1.1 5.1 Scaling
The system does no display noticeable side effects. We tested the number of active cells with A>100 for varying lattice sizes after 10000 iteration steps. The fraction of active sites was respectively 19.8 % for a 30×30 cell lattice, 19.1 % for 50×50 cells and 19.6 % for 100×100 cells. We found that the observed difference in percentage to be not significative.
1.2 5.2 Patterns Stability
Because the system is noisy we used the Pearson correlation coefficient to measure the correlation between a pattern of capital K taken at time 5000 and patterns observed at further times until t=10,000. We use a 50×50 network. The Pearson coefficient is measured by:
The Pearson coefficient decreases from 1 to 0.99 in 5000 time steps which demonstrates a long term stability after quasi equilibrium has been reached. We also checked the stability of the correlations between one cell and its neighbours at varying distances over 5000 time steps and similarly checked stability (Fig. 8).
1.3 5.3 Influence of Initial Conditions
A choice of initial conditions is arbitrary and we reported in Sect. 3 results obtained from random initial conditions without any spatial correlation. On the other hand, since the present state of the world is already structured in industrial regions, the possible importance of initial structures is worthwhile to study. We then ran simulations with initial sinusoidal patterns of A and K such that:
with several wave vectors k=2nπ/L, n=2, 5, 10 and lattice size L=50 (Fig. 9). Resource initial distribution were random.
The fraction of active sites is respectively 6.16, 11.18 and 19.32 % for n=2, 5, 10. Not surprisingly in view of the previously observed metastability, initial conditions do play a role in the final aspect of the patterns. The meso-scale initial periodicity is maintained while the micro structure of the localised peaks of activity reflects the character of the dynamics, independently from the initial conditions.
One might be tempted to investigate further the transition from present socio-economic patterns to future conditions with different energy sources. Let us remind that we are not able to describe the dynamics of the slow technological change that would drive the transition. The above set of remarks does not allow precise predictions: what we can still conclude is that some memory of the present large scale spatial structures could be maintained.
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Weisbuch, G. Sustainable Development and Spatial Inhomogeneities. J Stat Phys 151, 475–493 (2013). https://doi.org/10.1007/s10955-012-0639-y
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DOI: https://doi.org/10.1007/s10955-012-0639-y