Related papers: Information equilibrium as an economic principle
Formalism based on equilibrium statistical thermodynamics is applied to communication networks of decision making individuals. It is shown that in statistical ensembles for choice models, properly defined disutility can play the same role…
We study nonequilibrium thermodynamics of complex information flows induced by interactions between multiple fluctuating systems. Characterizing nonequilibrium dynamics by causal networks (i.e., Bayesian networks), we obtain novel…
We study a simple model of an asset market with informed and non-informed agents. In the absence of non-informed agents, the market becomes information efficient when the number of traders with different private information is large enough.…
Statistical divergences are important tools in data analysis, information theory, and statistical physics, and there exist well known inequalities on their bounds. However, in many circumstances involving temporal evolution, one needs…
We consider the formalism of information decomposition of target effects from multi-source interactions, i.e. the problem of defining redundant and synergistic components of the information that a set of source variables provides about a…
Complex dynamical systems driven by the unravelling of information can be modelled effectively by treating the underlying flow of information as the model input. Complicated dynamical behaviour of the system is then derived as an output.…
Information dynamics is an emerging description of information processing in complex systems which describes systems in terms of intrinsic computation, identifying computational primitives of information storage and transfer. In this paper…
Adaptation is used by biological sensory systems to respond to a wide range of environmental signals, by adapting their response properties to the statistics of the stimulus in order to maximize information transmission. We derive rules of…
We propose a new methodology to compute equilibria for general equilibrium problems on exchange economies with real financial markets, home-production, and retention. We demonstrate that equilibrium prices can be determined by solving a…
The minimum rate needed to accurately approximate a product distribution based on an unnormalized informational divergence is shown to be a mutual information. This result subsumes results of Wyner on common information and Han-Verd\'{u} on…
Information theory provides a mathematical foundation to measure uncertainty in belief. Belief is represented by a probability distribution that captures our understanding of an outcome's plausibility. Information measures based on…
We apply the theory of McKean-Vlasov-type SDEs to study several problems related to market efficiency in the context of partial information and partially observable financial markets: (i) convergence of reduced-information market price…
Optimal transport has become part of the standard quantitative economics toolbox. It is the framework of choice to describe models of matching with transfers, but beyond that, it allows to: extend quantile regression; identify discrete…
The question of deriving general force/flux relationships that apply out of the linear response regime is a central topic of theories for nonequilibrium statistical mechanics. This work applies an information theory perspective to compute…
Linearized models of power systems are often desirable to formulate tractable control and optimization problems that still reflect real-world physics adequately under various operating conditions. In this paper, we propose an approach that…
In a closed economic system, money is conserved. Thus, by analogy with energy, the equilibrium probability distribution of money must follow the exponential Gibbs law characterized by an effective temperature equal to the average amount of…
Information is a valuable asset for agents in socio-economic systems, a significant part of the information being entailed into the very network of connections between agents. The different interlinkages patterns that agents establish may,…
Within its range of applicability, the Boltzmann equation seems unique in its capacity to accurately describe the transition from almost any initial state to a self-equilibrated thermal state. Using information-theoretic methods to rephrase…
Social media has brought a revolution on how people are consuming news. Beyond the undoubtedly large number of advantages brought by social-media platforms, a point of criticism has been the creation of echo chambers and filter bubbles,…
We implement the Ising model on a structural connectivity matrix describing the brain at a coarse scale. Tuning the model temperature to its critical value, i.e. at the susceptibility peak, we find a maximal amount of total information…