arXiv subjects

Alessio Emanuele Biondo

Publications and source records attributed to Alessio Emanuele Biondo.

13 recordsLinked to original sources

arXiv2026

Inflation as an emergent phenomenon

We develop an agent-based model in which inflation emerges from decentralized price-setting and credit-financed production in an endogenous-money economy. Firms operate under working-capital constraints, form market-based price expectations through heterogeneous adaptive learning, and set prices via cost-plus rules with endogenous mark-ups. Bank lending simultaneously creates deposits, while heterogeneous lending rates and credit rationing shape firms' financing costs and, through unit costs, their pricing decisions. The economy features interacting production and credit networks: intermediate-input linkages propagate cost shocks across supply chains, while bank--firm relationships transmit financial conditions across firms. The interaction of network-based pass-through, state-dependent pricing incentives, and evolving credit conditions generates inflationary regimes, including episodes driven by pricing cascades and feedback loops.

econ.GN↗

arXiv2026

Mr.Keynes and the... Complexity! A suggested model for the General Theory

This paper presents a mathematical model of J.M. Keynes' The General Theory of Employment, Interest, and Money. The main message of Keynes remains intact: it is the preference for liquidity, the marginal efficiency of capital, and the marginal propensity to consume that determine the level of aggregate income and employment, given any possible interest rate. All parts of the model are strictly referred to the original text.

econ.TH↗

arXiv2023

The Paradox of Talent: how Chance affects Success in Tennis Tournaments

Individual sports competitions provide a natural setting for examining the relative importance of talent and luck/chance in achieving success. The belief that success is primarily due to individual abilities and hard work rather than external factors is particularly strong in this context. In this study, we test this belief using tennis as a case study, due to its popularity and competition structure in direct-elimination tournaments. Our dataset covers the decade 2010-2019 of main events in the ATP circuit and consists of tourney results and annual rankings for professional male players. After a preliminary data analysis, we introduce an agent-based model able to accurately simulate the tennis players' dynamics along several seasons. We show that, once calibrated on the dataset, the model is able to reproduce the main stylized facts observed in real data, including the results of single tournaments and the development of players' careers in the ATP community. The strength of our approach lies in its simplicity: it requires only one free parameter a to determine the importance of talent in scoring every single point: a = 1, if only talent matters; a = 0, if the outcome of each point is entirely due to chance. We find the best agreement between real data and simulation results when talent weights substantially less than luck, i.e. when a is between 0.20 and 0.30. A further comparison between data and simulations, based on the analysis of the direct networks of all the matches, confirms the previous finding. A posteriori, we notice that this surprisingly important role of chance in tennis tournaments is not an exception. On the contrary, it can be explained by a more general paradoxical effect that characterizes highly competitive environments, particularly in individual sports. In other words, when the difference in talent between top players is minimal, chance becomes determinant.

physics.soc-ph↗

arXiv2022

Pairwise and high-order dependencies in the cryptocurrency trading network

In this paper we analyse the effects of information flows in cryptocurrency markets. We first define a cryptocurrency trading network, i.e. the network made using cryptocurrencies as nodes and the Granger causality among their weekly log returns as links, later we analyse its evolution over time. In particular, with reference to years 2020 and 2021, we study the logarithmic US dollar price returns of the cryptocurrency trading network using both pairwise and high-order statistical dependencies, quantified by Granger causality and O-information, respectively. With reference to the former, we find that it shows peaks in correspondence of important events, like e.g., Covid-19 pandemic turbulence or occasional sudden prices rise. The corresponding network structure is rather stable, across weekly time windows in the period considered and the coins are the most influential nodes in the network. In the pairwise description of the network, stable coins seem to play a marginal role whereas, turning high-order dependencies, they appear in the highest number of synergistic information circuits, thus proving that they play a major role for high order effects. With reference to redundancy and synergy with the time evolution of the total transactions in US dollars, we find that their large volume in the first semester of 2021 seems to have triggered a transition in the cryptocurrency network toward a more complex dynamical landscape. Our results show that pairwise and high-order descriptions of complex financial systems provide complementary information for cryptocurrency analysis.

q-fin.TR↗

arXiv2022

Objective and perceived risk in seismic vulnerability assessment at urban scale

The assessment of seismic risk in urban areas with high seismicity is certainly one of the most important problems that territorial managers have to face. A reliable evaluation of this risk is the basis for the design of both specific seismic improvement interventions and emergency management plans. Unappropriate seismic risk assessments may provide misleading results and induce bad decisions with relevant economic and social impact. The seismic risk in urban areas is mainly linked to three factors, namely, "hazard", "exposure" and "vulnerability". Hazard measures the potential of an earthquake to produce harm; exposure evaluates the amount of population exposed to harm; vulnerability represents the proneness of considered buildings to suffer damages in case of an earthquake. Estimates of such factors may not always coincide with the perceived risk of the resident population. The propensity to implement structural seismic improvement interventions aimed at reducing the vulnerability of buildings depends significantly on the perceived risk. This paper investigates on the difference between objective and perceived risk and highlights some critical issues. The aim of this study is to calibrate opportune policies, which allow addressing the most appropriate seismic risk mitigation options with reference to current levels of perceived risk. We propose the introduction of a Seismic Policy Prevention index (SPPi). This methodology is applied to a case-study focused on a densely populated district of the city of Catania (Italy).

physics.soc-ph↗

arXiv2022

A dynamic model of Tax Evasion

In this paper we present a simplified model of a proportional taxation system where citizens decide whether to pay taxes or evade them. We initially derive a dynamic equation for the fraction of evaders and then present both its critical points and equilibrium stable states for a well-mixed population and for a fixed audit probability. Our theoretical predictions consider different possible income distributions (homogeneous and heterogeneous), time-dependent audit probability and different possible social topologies, by means of selected complex network configurations. All derived results are validated and confirmed by extended Monte Carlo simulations. Finally, some policy implications aimed to reduce tax evasion are suggested, with regards to the tax and fine rates and the audit probability.

physics.soc-ph↗

arXiv2020

On the origins of extreme wealth inequality in the Talent vs Luck Model

While wealth distribution in the world is highly skewed and heavy-tailed, human talent - as the majority of individual features - is normally distributed. In a recent computational study by Pluchino et al [Talent vs luck: The role of randomness in success and failure, Adv. Complex Syst. 21 (03-04) (2018) 1850014], it has been shown that the combined effects of both random external factors (lucky and unlucky events) and multiplicative dynamics in capital accumulation are able to clarify this apparent contradiction. We introduce here a simplified version (STvL) of the original Talent versus Luck (TvL) model, where only lucky events are present, and verify that its dynamical rules lead to the same very large wealth inequality as the original model. We also derive some analytical approximations aimed to capture the mechanism responsible for the creation of such wealth inequality from a Gaussian-distributed talent. Under these approximations, our analysis is able to reproduce quite well the results of the numerical simulations of the simplified model in special cases. On the other hand, it also shows that the complexity of the model lies in the fact that lucky events are transformed into an increase of capital with heterogeneous rates, which yields a non-trivial generalization of the role of multiplicative processes in generating wealth inequality, whose fully generic case is still not amenable to analytical computations.

physics.soc-ph↗

arXiv2019

Exploring the Role of Interdisciplinarity in Physics: Success, Talent and Luck

Although interdisciplinarity is often touted as a necessity for modern research, the evidence on the relative impact of sectorial versus to interdisciplinary science is qualitative at best. In this paper we leverage the bibliographic data set of the American Physical Society to quantify the role of interdisciplinarity in physics, and that of talent and luck in achieving success in scientific careers. We analyze a period of 30 years (1980-2009) tagging papers and their authors by means of the Physics and Astronomy Classification Scheme (PACS), to show that some degree of interdisciplinarity is quite helpful to reach success, measured as a proxy of either the number of articles or the citations score. We also propose an agent-based model of the publication-reputation-citation dynamics reproduces the trends observed in the APS data set. On the one hand, the results highlight the crucial role of randomness and serendipity in real scientific research; on the other, they shed light on a counter-intuitive effect indicating that the most talented authors are not necessarily the most successful ones.

physics.soc-ph↗

arXiv2016

A multilayer approach for price dynamics in financial markets

We introduce a new Self-Organized Criticality (SOC) model for simulating price evolution in an artificial financial market, based on a multilayer network of traders. The model also implements, in a quite realistic way with respect to previous studies, the order book dy- namics, by considering two assets with variable fundamental prices. Fat tails in the probability distributions of normalized returns are observed, together with other features of real financial markets.

q-fin.TR↗

arXiv2016

Order Book, Financial Markets and Self-Organized Criticality

We present a simple order book mechanism that regulates an artificial financial market with self-organized criticality dynamics and fat tails of returns distribution. The model shows the role played by individual imitation in determining trading decisions, while fruitfully replicates typical aggregate market behavior as the "self-fulfilling prophecy". We also address the role of random traders as a possible decentralized solution to dampen market fluctuations.

q-fin.TR↗

arXiv2014

Micro and Macro Benefits of Random Investments in Financial Markets

In this paper, making use of recent statistical physics techniques and models, we address the specific role of randomness in financial markets, both at the micro and the macro level. In particular, we review some recent results obtained about the effectiveness of random strategies of investment, compared with some of the most used trading strategies for forecasting the behavior of real financial indexes. We also push forward our analysis by means of a Self-Organized Criticality model, able to simulate financial avalanches in trading communities with different network topologies, where a Pareto-like power law behavior of wealth spontaneously emerges. In this context, we present new findings and suggestions for policies based on the effects that random strategies can have in terms of reduction of dangerous financial extreme events, i.e. bubbles and crashes.

q-fin.GN↗

arXiv2013

Reducing Financial Avalanches By Random Investments

Building on similarities between earthquakes and extreme financial events, we use a self-organized criticality-generating model to study herding and avalanche dynamics in financial markets. We consider a community of interacting investors, distributed on a small-world network, who bet on the bullish (increasing) or bearish (decreasing) behavior of the market which has been specified according to the S&P500 historical time series. Remarkably, we find that the size of herding-related avalanches in the community can be strongly reduced by the presence of a relatively small percentage of traders, randomly distributed inside the network, who adopt a random investment strategy. Our findings suggest a promising strategy to limit the size of financial bubbles and crashes. We also obtain that the resulting wealth distribution of all traders corresponds to the well-known Pareto power law, while the one of random traders is exponential. In other words, for technical traders, the risk of losses is much greater than the probability of gains compared to those of random traders.

q-fin.GN↗

arXiv2013

The beneficial role of random strategies in social and financial systems

In this paper we focus on the beneficial role of random strategies in social sciences by means of simple mathematical and computational models. We briefly review recent results obtained by two of us in previous contributions for the case of the Peter principle and the efficiency of a Parliament. Then, we develop a new application of random strategies to the case of financial trading and discuss in detail our findings about forecasts of markets dynamics.

physics.soc-ph↗