Socio-economic utility and chemical potential

Details Socio-economic utility and chemical potential Socio-economic utility and chemical potential

2010-10-15

arxiv.org/abs/1010.3225v2

EPL 93, 38002 (2011)

Physics

Physics and Society

6 pages, 3 figures, final version

Scientific paper

10.1209/0295-5075/93/38002

In statistical physics, the conservation of particle number results in the equalization of the chemical potential throughout a system at equilibrium. In contrast, the homogeneity of utility in socio-economic models is usually thought to rely on the competition between individuals, leading to Nash equilibrium. We show that both views can be reconciled by introducing a notion of chemical potential in a wide class of socio-economic models, and by relating it in a direct way to the equilibrium value of the utility. This approach also allows the dependence of utility across the system to be determined when agents take decisions in a probabilistic way. Numerical simulations of a urban economic model also suggest that our result is valid beyond the initially considered class of solvable models.

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