Probability Seminar
Thursday, February 23, 2017, 3:15pm, 119 Physics
Eric Foxall (Arizona State University)
The compulsive gambler with allowances
Abstract:
We consider a process in which a finite set of n agents continually receive a 1 dollar allowance and gamble their fortunes, all in, with one another at a constant rate. This is a variation on the existing compulsive gambler process; in that process, initial fortunes are prescribed and no further allowances are given out. For our process, we find that after some time the distribution of wealth settles into a pattern in which most people have only a few dollars, a few are very wealthy, and a single person possesses most of the cash currently present in the population. In addition, eventually the only way to attain first rank is by winning a bet against the current champion. Moreover, if agents play a fair game, i.e., the probability of winning a bet is proportional to the players' fortunes, the title of champion is assumed by every player infinitely often, although it changes less and less frequently as time goes on. Finally, by examining the process from both the perspective of typical fortune, and that of large fortune, we can go one step further and obtain two distinct limiting processes as n --> infty, with each one admitting a detailed description of its dynamics. [video]

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