Death, Taxes, and Inequality. Can a Minimal Model Explain Real Economic Inequality?

Abstract: Income inequality and redistribution policies are modeled with a minimal, endogenous model of a simple foraging economy. Significant income inequalities emerge from the model for populations of equally capable individuals presented with equal opportunities. Stochastic income distributions from the model are compared to empirical data from actual economies. The impacts of redistribution policies on total wealth, income distributions, and inequality are shown to be similar for the empirical data and the model. These comparisons enable detailed determinations of population welfare beyond what is possible with total wealth and inequality metrics. I