Instability and Information
Abstract
Many complex systems exhibit extreme events far more often than expected for a normal distribution. This work examines how self-similar bursts of activity across several orders of magnitude can emerge from first principles in systems that adapt to information. Surprising connections are found between two apparently unrelated research topics: hand-eye coordination in balancing tasks and speculative trading in financial markets. Seemingly paradoxically, locally minimising fluctuations can increase a dynamical system's sensitivity to unpredictable perturbations and thereby facilitate global catastrophes. This general principle is studied in several domain-specific models and in behavioural experiments. It explains many findings in both fields and resolves an apparent antinomy: the coexistence of stabilising control or market efficiency and perpetual instabilities resembling critical phenomena in physical systems.
Cite
@article{arxiv.1511.03732,
title = {Instability and Information},
author = {Felix Patzelt},
journal= {arXiv preprint arXiv:1511.03732},
year = {2015}
}
Comments
Doctoral Dissertation. Department of Neurophysics, Institute for Theoretical Physics, University of Bremen. First referee and supervisor: Prof. Dr. Klaus Pawelzik. Second referee: Prof. Dr. Stefan Bornholdt. Defence: June 4, 2014. Defence referees: Prof. Dr. Klaus Pawelzik, Prof. Dr. Stefan Bornholdt, Prof. Dr. Monika Fritz, Prof. Dr. Dr. Ulrich Krause