Statistical thermodynamics of economic systems

Details Statistical thermodynamics of economic systems Statistical thermodynamics of economic systems

2009-03-25

arxiv.org/abs/0903.4216v2

Economy

Quantitative Finance

Statistical Finance

Discussions added, typos corrected

Scientific paper

We formulate thermodynamics of economic systems in terms of an arbitrary probability distribution for a conserved economic quantity. As in statistical physics, thermodynamic macroeconomic variables emerge as the mean value of microeconomic variables and their determination is reduced to the computation of the partition function, starting from an arbitrary function. Explicit hypothetical examples are given which include linear and nonlinear economic systems, as well as multiplicative systems such as those dominated by a Pareto law distribution. We propose to use the formalism of phase transitions to study severe changes of macroeconomic variables.

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