Related papers: WARNING: Physics Envy May Be Hazardous To Your Wea…
Most of parameters used to describe states and dynamics of financial market depend on proportions of the appropriate variables rather than on their actual values. Therefore, projective geometry seems to be the correct language to describe…
Is speculative mathematics dangerous? Recent interactions between physics and mathematics pose the question with some force: traditional mathematical norms discourage speculation, but it is the fabric of theoretical physics. In practice…
Quantum mechanics, one of the most successful theories in the history of science, was created to account for physical systems not describable by classical physics. Though it is consistent with all experiments conducted thus far, many of its…
Economies are complex man-made systems where organisms and markets interact according to motivations and principles not entirely understood yet. The increasing dissatisfaction with the postulates of traditional economics i.e. perfectly…
In this study, we introduce a physical model inspired by statistical physics for predicting price volatility and expected returns by leveraging Level 3 order book data. By drawing parallels between orders in the limit order book and…
Physical concepts developed to describe instabilities in traffic flows can be generalized in a way that allows one to understand the well-known instability of supply chains (the so-called ``bullwhip effect''). That is, small variations in…
The traditional and most common view of economists on the issue of (bad) uncertainty and its effects has been one of partial equilibrium. When the topic is approached from a macroeconomic perspective, the most frequent has been the…
Reliable uncertainty quantification is essential for the use of machine learning in physics, where scientific discoveries depend on validated probabilistic statements. We provide a structured overview of uncertainty quantification in ML for…
Although classical economic theory is based on the concept of stable equilibrium, real economic systems appear to be always out of equilibrium. Indeed, they share many of the dynamical features of other complex systems, e.g., ecological…
For this special issue, the article aims at discussing a few econophysics problems studied so far rather successfully. The following "applications" in micro-econo-physics are considered : (i) financial crashes; it is emphasized that one can…
In recent publications in physics and mathematics, concerns have been raised about the use of real numbers to describe quantities in physics, and in particular about the usual assumption that physical quantities are infinitely precise. In…
The relationships between game theory and quantum mechanics let us propose certain quantization relationships through which we could describe and understand not only quantum but also classical, evolutionary and the biological systems that…
This note investigates the causes of the quality anomaly, which is one of the strongest and most scalable anomalies in equity markets. We explore two potential explanations. The "risk view", whereby investing in high quality firms is…
The unsatisfactory status of the search for a consistent and predictive quantization of gravity is taken as motivation to study the question whether geometrical laws could be more fundamental than quantization procedures. In such an…
The purpose of this paper is to show the magic of physics by showing the physics of magic. What usually makes magic tricks interesting is that something unexpected occurs. Similarly, demonstrations are interesting inasmuch as they produce…
QBism is currently one of the most widely discussed 'subjective' interpretations of quantum mechanics. Its key move is to say that quantum probabilities are personalist Bayesian probabilities and that the quantum state represents subjective…
Quantum mechanics marks a radical departure from the classical understanding of Nature, fostering an inherent randomness which forbids a deterministic description; yet the most fundamental departure arises from something different. As shown…
The relationship between chaos and quantum mechanics has been somewhat uneasy -- even stormy, in the minds of some people. However, much of the confusion may stem from inappropriate comparisons using formal analyses. In contrast, our…
Established idea-sets don't update seamlessly. The tension between new and old views of nature is e.g. documented in Galileo's dialogs and now present in many fields. However the science of Bayesian model-selection has made recent strides…
The applications of techniques from statistical (and classical) mechanics to model interesting problems in economics and finance has produced valuable results. The principal movement which has steered this research direction is known under…