Related papers: Statistical ensembles for money and debt
The foundations of the Boltzmann-Gibbs (BG) distributions for describing equilibrium statistical mechanics of systems are examined. Broadly, they fall into: (i) probabilistic paaroaches based on the principle of equal a priori probability…
This paper develops a new model of business cycles. The model is economical in that it is solved with an aggregate demand-aggregate supply diagram, and the effects of shocks and policies are obtained by comparative statics. The model builds…
We find the wealth distribution for an economic agent in the financial market, in analogy with standard derivation of generaliz Boltzman (Tsallis) factor in statistical mechanics. In this respect, Tsallis entropic index separates two…
Our computational economic analysis investigates the relationship between inequality, mobility and the financial accumulation process. Extending the baseline model by Levy et al., we characterise the economic process through stylised return…
There is a widespread recent interest in using ideas from statistical physics to model certain types of problems in economics and finance. The main idea is to derive the macroscopic behavior of the market from the random local interactions…
The Gibbs-Boltzmann distribution offers a physically interpretable way to massively reduce the dimensionality of high dimensional probability distributions where the extensive variables are `features' and the intensive variables are…
Statistical mechanics can only be ultimately justified in terms of microscopic dynamics (classical, quantum, relativistic, or any other). It is known that Boltzmann-Gibbs statistics is based on the hypothesis of exponential sensitivity to…
Two kinetic exchange models are proposed to explore the dynamics of closed economic markets characterized by random exchanges, saving propensities, and collective transactions. Model I simulates a system where individual transactions occur…
We discuss superstatistics theory of labour productivity. Productivity distribution across workers, firms and industrial sectors are studied empirically and found to obey power-distributions, in sharp contrast to the equilibrium theories of…
The classical wave-particle Hamiltonian is considered in its generalized version, where two modes are assumed to interact with the co-evolving charged particles. The equilibrium statistical mechanics solution of the model is worked out…
We analyze the problem of optimal reduction of the debt-to-GDP ratio in a stochastic control setting. The debt-to-GDP dynamics are modeled through a stochastic differential equation in which fiscal policy simultaneously affects both debt…
A general information equilibrium model in the case of ideal information transfer is defined and then used to derive the relationship between supply (information destination) and demand (information source) with the price as the detector of…
Climate models have become an important tool in the study of climate and climate change, and ensemble experiments consisting of multiple climate-model runs are used in studying and quantifying the uncertainty in climate-model output.…
As well known, Boltzmann-Gibbs statistics is the correct way of thermostatistically approaching ergodic systems. On the other hand, nontrivial ergodicity breakdown and strong correlations typically drag the system into out-of-equilibrium…
The theory of superstatistics is a generalization of Boltzmann-Gibbs statistical mechanics which admits temperature fluctuations, and generates non-canonical ensembles from the distribution function of these fluctuations. Recently, some…
Quasi-equilibrium models for aggregate variables are widely-used throughout finance and economics. The validity of such models depends crucially upon assuming that the systems' participants behave both independently and in a Markovian…
Statistical mechanics provides a useful analog for understanding the behavior of complex adaptive systems, including electric power markets and the power systems they intend to govern. Market-based control is founded on the conjecture that…
Macro-economic models describe the dynamics of economic quantities. The estimations and forecasts produced by such models play a substantial role for financial and political decisions. In this contribution we describe an approach based on…
The basic idea of a microscopic understanding of Thermodynamics is to derive its main features from a microscopic probability distribution. In such a vein, we investigate the thermal statistics of quasi-probabilities's semi-classical…
We propose a stochastic map model of economic dynamics. In the last decade, an array of observations in economics has been investigated in the econophysics literature, a major example being the universal features of inequality in terms of…