Related papers: Quantum propensity in economics
A new paradigm of quantum computing, namely, soft quantum computing, is proposed for nonclassical computation using real world quantum systems with naturally occurring environment-induced decoherence and dissipation. As a specific example…
We give a mathematical definition for the notion of inconclusive quantum measurements. In physics, such measurements occur at intermediate stages of a complex measurement procedure, with the final measurement result being operationally…
We study a financial model with a non-trivial price impact effect. In this model we consider the interaction of a large investor trading in an illiquid security, and a market maker who is quoting prices for this security. We assume that the…
We introduce a classical-quantum hybrid approach to computation, allowing for a quadratic performance improvement in the decision process of a learning agent. In particular, a quantum routine is described, which encodes on a quantum…
Traders constantly consider the price impact associated with changing their positions. This paper seeks to understand how price impact emerges from the quoting strategies of market makers. To this end, market making is modeled as a dynamic…
We apply Reinforcement Learning algorithms to solve the classic quantitative finance Market Making problem, in which an agent provides liquidity to the market by placing buy and sell orders while maximizing a utility function. The optimal…
We present two applications where open system quantum simulation is the preferred approach on a quantum computer. We choose concrete parameters for the problems in such a way that the application value, which we call utility, can be…
The efficient management of energy communities relies on the solution of the "prosumer problem", i.e., the problem of scheduling the household loads on the basis of the user needs, the electricity prices, and the availability of local…
Universality of quantum mechanics -- its applicability to physical systems of quite different nature and scales -- indicates that quantum behavior can be a manifestation of general mathematical properties of systems containing…
Classical algorithms for market equilibrium computation such as proportional response dynamics face scalability issues with Internet-based applications such as auctions, recommender systems, and fair division, despite having an almost…
Among various algorithms designed to exploit the specific properties of quantum computers with respect to classical ones, the quantum adiabatic algorithm is a versatile proposition to find the minimal value of an arbitrary cost function…
More than hundred years ago the 'classic physics' was it in its full power, with just a few unexplained phenomena; which however led to a revolution and the development of the 'modern physics'. Today the computing is in a similar position:…
We propose a quantum expected value theory for decision-making under uncertainty. Quantum density operator as value operator is proposed to simulate people's subjective beliefs. Value operator guides people to choose corresponding actions…
Traditional cognitive science rests on a foundation of classical logic and probability theory. This foundation has been seriously challenged by several findings in experimental psychology on human decision making. Meanwhile, the formalism…
Quantum uncertainty is the cornerstone of quantum mechanics which underlies many counterintuitive nonclassical phenomena. Recent studies remarkably showed that it also fundamentally limits nonclassical correlation, and crucially, a…
The paper discusses various practical consequences of treating economics and finance as an inherently dynamic and chaotic system. On the theoretical side this looks at the general applicability of the market-making pricing approach to…
A derivative is a financial security whose value is a function of underlying traded assets and market outcomes. Pricing a financial derivative involves setting up a market model, finding a martingale (``fair game") probability measure for…
Open-source projects that aim to make their offerings public have competed against for-profit, proprietary companies in a number of domains. These open-source projects often arise in response to the offerings of proprietary companies in…
In two previous papers the author developed a second-order price adjustment (t\^atonnement) process. This paper extends the approach to include both quantity and price adjustments. We demonstrate three results: a analogue to physical…
Recent theoretical results confirm that quantum theory provides the possibility of new ways of performing efficient calculations. The most striking example is the factoring problem. It has recently been shown that computers that exploit…