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Kinetic Exchange Models Of Markets
Kinetic exchange models are multi-agent dynamic models inspired by the statistical physics of energy distribution, which try to explain the robust and universal features of income/wealth distributions. Understanding the distributions of income and wealth in an economy has been a classic problem in economics for more than a hundred years. Today it is one of the main branches of econophysics. Data and basic tools In 1897, Vilfredo Pareto first found a universal feature in the distribution of wealth. After that, with some notable exceptions, this field had been dormant for many decades, although accurate data had been accumulated over this period. Considerable investigations with the real data during the last fifteen years (1995–2010) revealed that the tail (typically 5 to 10 percent of agents in any country) of the income/wealth distribution indeed follows a power law. However, the majority of the population (i.e., the low-income population) follows a different distribution whi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Statistical Physics
Statistical physics is a branch of physics that evolved from a foundation of statistical mechanics, which uses methods of probability theory and statistics, and particularly the Mathematics, mathematical tools for dealing with large populations and approximations, in solving physical problems. It can describe a wide variety of fields with an inherently stochastic nature. Its applications include many problems in the fields of physics, biology, chemistry, and neuroscience. Its main purpose is to clarify the properties of matter in aggregate, in terms of physical laws governing atomic motion. Statistical mechanics develop the Phenomenology (particle physics), phenomenological results of thermodynamics from a probabilistic examination of the underlying microscopic systems. Historically, one of the first topics in physics where statistical methods were applied was the field of classical mechanics, which is concerned with the motion of particles or objects when subjected to a force. ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Agent (economics)
In economics, an agent is an actor (more specifically, a decision maker) in a model of some aspect of the economy. Typically, every agent makes decisions by solving a well- or ill-defined optimization or choice problem. For example, ''buyers'' (consumers) and ''sellers'' ( producers) are two common types of agents in partial equilibrium models of a single market. Macroeconomic models, especially dynamic stochastic general equilibrium models that are explicitly based on microfoundations, often distinguish households, firms, and governments or central banks as the main types of agents in the economy. Each of these agents may play multiple roles in the economy; households, for example, might act as consumers, as workers, and as voters in the model. Some macroeconomic models distinguish even more types of agents, such as workers and shoppers or commercial banks. The term ''agent'' is also used in relation to principal–agent models; in this case, it refers specifically to someone de ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utility Maximization
Utility maximization was first developed by utilitarian philosophers Jeremy Bentham and John Stuart Mill. In microeconomics, the utility maximization problem is the problem consumers face: "How should I spend my money in order to maximize my utility?" It is a type of optimal decision problem. It consists of choosing how much of each available good or service to consume, taking into account a constraint on total spending (income), the prices of the goods and their preferences. Utility maximization is an important concept in consumer theory as it shows how consumers decide to allocate their income. Because consumers are rational, they seek to extract the most benefit for themselves. However, due to bounded rationality and other biases, consumers sometimes pick bundles that do not necessarily maximize their utility. The utility maximization bundle of the consumer is also not set and can change over time depending on their individual preferences of goods, price changes and increase ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Entropy Maximization
The principle of maximum entropy states that the probability distribution which best represents the current state of knowledge about a system is the one with largest entropy, in the context of precisely stated prior data (such as a proposition that expresses testable information). Another way of stating this: Take precisely stated prior data or testable information about a probability distribution function. Consider the set of all trial probability distributions that would encode the prior data. According to this principle, the distribution with maximal information entropy is the best choice. History The principle was first expounded by E. T. Jaynes in two papers in 1957 where he emphasized a natural correspondence between statistical mechanics and information theory. In particular, Jaynes offered a new and very general rationale why the Gibbsian method of statistical mechanics works. He argued that the entropy of statistical mechanics and the information entropy of informatio ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Empirical
Empirical evidence for a proposition is evidence, i.e. what supports or counters this proposition, that is constituted by or accessible to sense experience or experimental procedure. Empirical evidence is of central importance to the sciences and plays a role in various other fields, like epistemology and law. There is no general agreement on how the terms ''evidence'' and ''empirical'' are to be defined. Often different fields work with quite different conceptions. In epistemology, evidence is what justifies beliefs or what determines whether holding a certain belief is rational. This is only possible if the evidence is possessed by the person, which has prompted various epistemologists to conceive evidence as private mental states like experiences or other beliefs. In philosophy of science, on the other hand, evidence is understood as that which ''Scientific method#Confirmation, confirms'' or ''disconfirms'' Hypothesis#Scientific hypothesis, scientific hypotheses and arbitrates ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Pareto Tail
In statistics and business, a long tail of some distributions of numbers is the portion of the distribution having many occurrences far from the "head" or central part of the distribution. The distribution could involve popularities, random numbers of occurrences of events with various probabilities, etc. The term is often used loosely, with no definition or an arbitrary definition, but precise definitions are possible. In statistics, the term ''long-tailed distribution'' has a narrow technical meaning, and is a subtype of heavy-tailed distribution. Intuitively, a distribution is (right) long-tailed if, for any fixed amount, when a quantity exceeds a high level, it almost certainly exceeds it by at least that amount: large quantities are probably even larger. Note that there is no sense of ''the'' "long tail" of a distribution, but only the ''property'' of a distribution being long-tailed. In business, the term ''long tail'' is applied to rank-size distributions or rank-freq ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Gamma Function
In mathematics, the gamma function (represented by , the capital letter gamma from the Greek alphabet) is one commonly used extension of the factorial function to complex numbers. The gamma function is defined for all complex numbers except the non-positive integers. For every positive integer , \Gamma(n) = (n-1)!\,. Derived by Daniel Bernoulli, for complex numbers with a positive real part, the gamma function is defined via a convergent improper integral: \Gamma(z) = \int_0^\infty t^ e^\,dt, \ \qquad \Re(z) > 0\,. The gamma function then is defined as the analytic continuation of this integral function to a meromorphic function that is holomorphic in the whole complex plane except zero and the negative integers, where the function has simple poles. The gamma function has no zeroes, so the reciprocal gamma function is an entire function. In fact, the gamma function corresponds to the Mellin transform of the negative exponential function: \Gamma(z) = \mathcal M \ (z ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Law Of Conservation
In physics, a conservation law states that a particular measurable property of an isolated physical system does not change as the system evolves over time. Exact conservation laws include conservation of energy, conservation of linear momentum, conservation of angular momentum, and conservation of electric charge. There are also many approximate conservation laws, which apply to such quantities as mass, parity, lepton number, baryon number, strangeness, hypercharge, etc. These quantities are conserved in certain classes of physics processes, but not in all. A local conservation law is usually expressed mathematically as a continuity equation, a partial differential equation which gives a relation between the amount of the quantity and the "transport" of that quantity. It states that the amount of the conserved quantity at a point or within a volume can only change by the amount of the quantity which flows in or out of the volume. From Noether's theorem, each conservation law is ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Ideal Gas
An ideal gas is a theoretical gas composed of many randomly moving point particles that are not subject to interparticle interactions. The ideal gas concept is useful because it obeys the ideal gas law, a simplified equation of state, and is amenable to analysis under statistical mechanics. The requirement of zero interaction can often be relaxed if, for example, the interaction is perfectly elastic or regarded as point-like collisions. Under various conditions of temperature and pressure, many real gases behave qualitatively like an ideal gas where the gas molecules (or atoms for monatomic gas) play the role of the ideal particles. Many gases such as nitrogen, oxygen, hydrogen, noble gases, some heavier gases like carbon dioxide and mixtures such as air, can be treated as ideal gases within reasonable tolerances over a considerable parameter range around standard temperature and pressure. Generally, a gas behaves more like an ideal gas at higher temperature and lower pressu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Taxation
A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal person, legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or national), and tax compliance refers to policy actions and individual behaviour aimed at ensuring that taxpayers are paying the right amount of tax at the right time and securing the correct tax allowances and tax reliefs. The first known taxation took place in Ancient Egypt around 3000–2800 BC. A failure to pay in a timely manner (Tax noncompliance, non-compliance), along with evasion of or resistance to taxation, is punishable by law. Taxes consist of direct tax, direct or indirect taxes and may be paid in money or as its labor equivalent. Most countries have a tax system in place, in order to pay for public, common societal, or agreed national needs and for the functions of government. Some levy a flat tax, flat percentag ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Savings
Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions. This includes the core meaning as held in the originating Old English word , which is from an Indo-European word stem. The modern concept of wealth is of significance in all areas of economics, and clearly so for growth economics and development economics, yet the meaning of wealth is context-dependent. An individual possessing a substantial net worth is known as ''wealthy''. Net worth is defined as the current value of one's assets less liabilities (excluding the principal in trust accounts). At the most general level, economists may define wealth as "the total of anything of value" that captures both the subjective nature of the idea and the idea that it is not a fixed or static concept. Various definitions and concepts of wealth have been asserted by various individuals and in different contexts.Denis "Authentic Development: Is i ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Benoit Mandelbrot
Benoit B. Mandelbrot (20 November 1924 – 14 October 2010) was a Polish-born French-American mathematician and polymath with broad interests in the practical sciences, especially regarding what he labeled as "the art of roughness" of physical phenomena and "the uncontrolled element in life". He referred to himself as a "fractalist" and is recognized for his contribution to the field of fractal geometry, which included coining the word "fractal", as well as developing a theory of "roughness and self-similarity" in nature. In 1936, at the age of 11, Mandelbrot and his family emigrated from Warsaw, Poland, to France. After World War II ended, Mandelbrot studied mathematics, graduating from universities in Paris and in the United States and receiving a master's degree in aeronautics from the California Institute of Technology. He spent most of his career in both the United States and France, having dual French and American citizenship. In 1958, he began a 35-year career at ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
