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The classical Density Functional Theory (DFT) is introduced as an application of entropic inference for inhomogeneous fluids at thermal equilibrium. It is shown that entropic inference reproduces the variational principle of DFT when…
Economic assessment in environmental science concerns the measurement or valuation of environmental impacts, adaptation, and vulnerability. Integrated assessment modeling is a unifying framework of environmental economics, which attempts to…
Most of the econometric and econophysics models have been borrowed from the statistical physics, and as a cosequence, a new interdisciplinary science called econophysics has emerged. In this paper we planned to extend the analogy between…
Financial econometrics has become an increasingly popular research field. In this paper we review a few parametric and nonparametric models and methods used in this area. After introducing several widely used continuous-time and…
We analyze the relative price change of assets starting from basic supply/demand considerations subject to arbitrary motivations. The resulting stochastic differential equation has coefficients that are functions of supply and demand. We…
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…
This Chapter reviews statistical models for the probability distribution of money developed in the econophysics literature since the late 1990s. In these models, economic transactions are modeled as random transfers of money between the…
Depending on the recent experiments and some new way of explaining electron we have developed here equations for velocities of different mode with the charge density. This includes as well how the charge-density can be distributed in the…
We review the plethora of uncertainty relations that appear in quantum mechanics and their nuances. We present both foundational applications, e.g. in understanding and defining complementarity, and practical applications, e.g. in quantum…
A vast concourse of events and phenomena occur in nature that may be interrelated by a entropy-maximization technique that provides a comprehensible explanation of a range of physical problems, integrating in a new framework the universal…
The relationship between micro-structure and macro-structure of complex systems using information geometry has been dealt by several authors. From this perspective, we are going to apply it as a geometrical structure connecting both…
In this paper, we develop econometric tools to analyze the integrated volatility of the efficient price and the dynamic properties of microstructure noise in high-frequency data under general dependent noise. We first develop consistent…
In the present paper, we identify several distributions from Physics and study their applicability to phenomena such as distribution of income, wealth, and expenditure. Firstly, we apply logistic distribution to these data and we find that…
A parametric method similar to autoregressive spectral estimators is proposed to determine the probability density function (pdf) of a random set. The method proceeds by maximizing the likelihood of the pdf, yielding estimates that perform…
Envelope methodology can provide substantial efficiency gains in multivariate statistical problems, but in some applications the estimation of the envelope dimension can induce selection volatility that may mitigate those gains. Current…
Methods and techniques of the theory of nonlinear dynamical systems and patterns can be useful in astrophysical applications. Some works on the subjects of dynamical astronomy, stellar pulsation and variability, as well as spatial…
Parametric statistical methods play a central role in analyzing risk through its underlying frequency and severity components. Given the wide availability of numerical algorithms and high-speed computers, researchers and practitioners often…
In this study, we introduce a physical model inspired by statistical physics for predicting price volatility and expected returns by leveraging Level 3 order book data. By drawing parallels between orders in the limit order book and…
This review presents the set of electricity price models proposed in the literature since the opening of power markets. We focus on price models applied to financial pricing and risk management. We classify these models according to their…
The applications of techniques from statistical (and classical) mechanics to model interesting problems in economics and finance has produced valuable results. The principal movement which has steered this research direction is known under…