Related papers: Cash Flow Entropy
Recently, the Shannon entropy, which was introduced originally as a measure of information amount, has been widely used as a useful index of various diversities such as biodiversity and geodiversity. In this work we have evaluated the…
We introduce a pathwise approach to analyze the relative performance of an equity portfolio with respect to a benchmark market portfolio. In this energy-entropy framework, the relative performance is decomposed into three components: a…
Kinetic exchange models have been successful in explaining the shape of the income/wealth distribution in the economies. However, such models usually make some ad-hoc assumptions when it comes to determining the savings factor. Here, we…
The entropy of a hierarchical network topology in an ensemble of sparse random networks with "hidden variables" associated to its nodes, is the log-likelihood that a given network topology is present in the chosen ensemble.We obtain a…
Small-to-medium size enterprises (SMEs), including many startup firms, need to manage interrelated flows of cash and inventories of goods. In this paper, we model a firm that can finance its inventory (ordered or manufactured) with loans in…
We introduce uncertainty into a pure exchange economy and establish a connection between Shannon's differential entropy and uniqueness of price equilibria. The following conjecture is proposed under the assumption of a uniform probability…
Pairwise interactions between individuals are taken as fundamental drivers of collective behavior responsible for group cohesion and decision-making. While an individual directly influences only a few neighbors, over time indirect…
this paper addresses the issue of the relation between the system efficiency and the individual performance with different combinations of agent memory lengths in mix-game model which is an extension of minority game (MG). In mix-game,…
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…
In classical and quantum information theory, operational quantities such as the amount of randomness that can be extracted from a given source or the amount of space needed to store given data are normally characterized by one of two…
Much of uncertainty quantification to date has focused on determining the effect of variables modeled probabilistically, and with a known distribution, on some physical or engineering system. We develop methods to obtain information on the…
The institution of money can be seen as a foundational social mechanism, enabling communities to quantify collectively regulate economic processes. Money can be said, indeed, to constitute the micro-macro link in economics. This paper…
We test the hypothesis that interconnections across financial institutions can be explained by a diversification motive. This idea stems from the empirical evidence of the existence of long-term exposures that cannot be explained by a…
Turbulence may appear as a complex process with a multitude of scales and flow patterns, but still obeys simple physical principles such as the conservation of momentum, of energy, and the maximum entropy principle. The latter states that…
We extend previously proposed measures of complexity, emergence, and self-organization to continuous distributions using differential entropy. This allows us to calculate the complexity of phenomena for which distributions are known. We…
This paper attempts to find a relationship between agents' risk aversion and inequality of incomes. Specifically, a model is proposed for the evolution in time of surplus/deficit distribution, and the long-time distributions are…
We consider a version of large population games whose agents compete for resources using strategies with adaptable preferences. Diversity among the agents reduces their maladpative behavior. We find interesting scaling relations with…
We expose the information flow capabilities of pure bipartite entanglement as a theorem -- which embodies the exact statement on the `seemingly acausal flow of information' in protocols such as teleportation. We use this theorem to…
In our model, private actors with interbank cash flows similar to, but nore general than (Carmona, Fouque, Sun, 2013) borrow from the outside economy at a certain interest rate, controlled by the central bank, and invest in risky assets.…
We consider a class of jump games in which agents of different types occupy the nodes of a graph aiming to maximize the variety of types in their neighborhood. In particular, each agent derives a utility equal to the number of types…