Universal Growth in Production Economies
We study a simple variant of the von Neumann model of an expanding economy, in which multiple producers make goods according to their endowed production function. The players trade their goods at the market and then use the bundles acquired as inputs for the production in the next round. The decision that players have to make is how to invest their money (i.e. bids) in each round.
We show that a simple decentralized dynamic, where players update their bids proportionally to how useful the investments were in the past round, leads to growth of the economy in the long term (whenever growth is possible) but also creates unbounded inequality, i.e. very rich and very poor players emerge. We analyze several other phenomena, such as how the relation of a player with others influences its development and the Gini index of the system. 
We show that a simple decentralized dynamic, where players update their bids proportionally to how useful the investments were in the past round, leads to growth of the economy in the long term (whenever growth is possible) but also creates unbounded inequality, i.e. very rich and very poor players emerge. We analyze several other phenomena, such as how the relation of a player with others influences its development and the Gini index of the system.
This paper studies the evolution of a growing production economy under a certain dynamic model of participant behavior.  The model is a minor variation on a classic model of von Neumann.  There are n firms, each producing their own type of good, and each with a budget of money.  Each firm i also has the ability to convert units of any other good j into units of their own good, at some given conversion rate a_{ij}.  Each round, the firms bid on the goods produced by other firms.  This results in exchanges of goods for money (more on this below).  After this, the firms convert any acquired goods into their own type of good, and the process repeats.  The economy is said to expand if the total quantity of goods increases without bound.  Rather than study the optimal equilibrium growth, the paper studies the following dynamics.  In each round, firms bid on goods in proportion to how much the goods contributed to their production last round.  Also, the bidding is resolved by proportional share: each firm's output is divided in proportion to the bids received, and every firm pays their bids.  The main result of the paper is that if there is any production path such that the economy expands, then this proportional dynamics will also expand.  Furthermore, the rate of expansion converges to the optimal rate of expansion.  This result is complemented with a variety of simulations and structural observations.  E.g., growth can oscillate, and some firms will grow more quickly than others in the limit.  The authors relate this last observation to notions of income inequality, and simulate the evolution of the GINI index in simple economies.  Comments  I like the idea of studying growth in pure production economies.  This is a classic topic in market theory that has not received much (or any) attention in the TCS literature.  The model studied here is a simple and natural starting point.  I also like the agenda of understanding natural dynamics by which firms learn to bid and bring the economy toward equilibrium.  This has been a successful line of inquiry for markets with consumption, so it makes sense to apply it here as well.  The main result --- that the proposed dynamics leads to optimal growth --- is clean and appealing.  The proof is short and slick, following a potential-function argument.  While similar arguments have been used for other market types, the setting here is different enough that new ideas were needed.    The strength of the main result depends on how much the reader likes the "trading-post proportional-bidding" dynamics being studied.  Personally I think the model is reasonable, as it blends together two ideas (proportional sharing of outcomes and proportional bidding) that have been well-studied in related contexts.  I do find myself wondering if there is evidence that this dynamics is predictive.  Do we expect that markets actually behave this way?  Or is the point of the paper that a market-maker should encourage production firms to behave this way?  More motivation would be welcome.  I found the other content in the paper less exciting.  For instance:  - I find it natural that some firms grow more quickly than others, since there is no consumption, taxation, or limited labor pool.  Since those forces are missing here, it's unsurprising that firms on the "efficient" production path will extract much of the gains.  Because of this, I don't view the paper as saying too much about inequality in practical modern economies.   - The presence of phase transitions in growth vs shrinkage of a firm is not particularly exciting, as this essentially amounts to a certain coefficient being larger or smaller than 1, which naturally occurs at a transition point.  - The presence of oscillation patterns is to be expected, as the discrete nature of time coupled with the fact that an efficient cycle might contract at some points and expand at others leads directly to non-monotonicities.  One thing I would have liked to see is more comparison between the dynamics and the equilibrium (i.e., optimal) growth.  E.g., rate of convergence, and whether the set of growing vs vanishing firms differs between the dynamic and equilibrium outcomes in the long run.  A more complete analysis of equilibria in this particular variant of von Neumann's model would help to better appreciate the outcome of the learning dynamics.  Overall, I think the model being studied is natural, and the main result provides a crisp result for a natural set of local dynamics.  The fact that one very specific set of dynamics is studied does limit the significance of the work, but I believe there is a reasonable chance that this model could generate follow-up work.  On the other hand, the paper is padded out with a significant amount of extra content that I think detracts from the overall message, and the clarity of the paper suffers as a result.  The topic of "firms learning to bid in an economy" fits within the scope of NIPS, if perhaps tangentially.  Comments for the authors  Abstract, line 7: the comment about "unbounded inequality" makes it sound as though this is an outcome specific to the dynamics.  Would a social planner designing an optimal rate of growth not also generate unbounded inequality?  I'd clarify and/or rephrase both here and in the introduction. Page 3, line 96: Should we take these oscillation patterns as evidence that the model is not predictive?  Or should we expect these outcomes in practice?  Consider commenting on this here or elsewhere. Page 7, line 270: please comment on the strength of this assumption of a unique best cycle Page 7, line 274: broken reference to an Appendix  Response to Author Comments:  The authors make a good point about adversarial initial states, and the challenge that they pose. I still feel that many of the "extra" results are unsurprising at a qualitative/conceptual level, but I certainly don't mean to imply that they are obvious or trivial on a technical level.  I still feel very positively about the "main" (in my opinion) contribution, which is the convergence and optimal growth properties of the studied dynamics.