Related papers: Information equilibrium as an economic principle
Understanding the pattern formation in communities has been at the center of attention in various fields. Here we introduce a novel model, called an "information-particle model," which is based on the reaction-diffusion model and the…
In financial markets valuable information is rarely circulated homogeneously, because of time required for information to spread. However, advances in communication technology means that the 'lifetime' of important information is typically…
The article develops a general equilibrium model where power relations are central in the determination of unemployment, profitability, and income distribution. The paper contributes to the market forces versus institutions debate by…
Thermodynamics is based on the notions of energy and entropy. While energy is the elementary quantity governing physical dynamics, entropy is the fundamental concept in information theory. In this work, starting from first principles, we…
We introduce the Estimated Dynamic Equilibrium Model (EDEM), an agent-based framework that treats supply and demand as a coupled stochastic process driven by heterogeneous, noisy agent valuations. The model's primary technical contribution…
We propose an information theoretic model for sociological networks. The model is a microcanonical ensemble of states and particles. The states are the possible pairs of nodes (i.e. people, sites and alike) which exchange information. The…
In this paper, our aim is to propose a model that helps in the efficient use of an information system by users, within the organization represented by the IS, in order to resolve their decisional problems. In other words we want to aid the…
Information theory is a practical and theoretical framework developed for the study of communication over noisy channels. Its probabilistic basis and capacity to relate statistical structure to function make it ideally suited for studying…
We consider a class of generalized capital asset pricing models in continuous time with a finite number of agents and tradable securities. The securities may not be sufficient to span all sources of uncertainty. If the agents have…
Using information theory we derive a thermodynamics for systems evolving under a collective motion, i.e. under a time-odd constraint. An illustration within the Lattice gas Model is given for two model cases: a collision between two complex…
When additional information sources are available, an important question for an agent solving a certain problem is how to optimally use the information the sources are capable of providing. A framework that relates information accuracy on…
General equilibrium is the dominant theoretical framework for economic policy analysis at the level of the whole economy. In practice, general equilibrium treats economies as being always in equilibrium, albeit in a sequence of equilibria…
The optimal (`equilibrium') macroscopic properties of an economy with $N$ industries endowed with different technologies, $P$ commodities and one consumer are derived in the limit $N\to\infty$ with $n=N/P$ fixed using the replica method.…
In this chapter, an input-output economic model with multiple interactive economic systems is considered. The model captures the multi-dimensional nature of the economic sectors or industries in each economic system, the interdependencies…
The paper treats the financial market as a communication system, using four information-theoretic assumptions to derive an idealized model with only one parameter. State variables are scalar stationary diffusions. The model minimizes the…
An asymmetric information model is introduced for the situation in which there is a small agent who is more susceptible to the flow of information in the market than the general market participant, and who tries to implement strategies…
We establish the fluctuation theorem in the presence of information exchange between a nonequilibrium system and other degrees of freedom such as an observer and a feedback controller, where the amount of information exchange is added to…
We introduce a simple model for addressing the controversy in the study of financial systems, sometimes taken as brownian-like processes and other as critical systems with fluctuations of arbitrary magnitude. The model considers a…
Denoising diffusion models have spurred significant gains in density modeling and image generation, precipitating an industrial revolution in text-guided AI art generation. We introduce a new mathematical foundation for diffusion models…
The question of how irreversibility can emerge as a generic phenomena when the underlying mechanical theory is reversible has been a long-standing fundamental problem for both classical and quantum mechanics. We describe a mechanism for the…