A locally-built, LLM-digested index of recent arXiv papers in quant finance, geometry/topology, and statistical ML — keyword search served straight from SQLite on this machine.
Current economic theories miss most of economic dynamics.
Historical economic growth in Latin America is analysed using the data of Maddison. Unified Growth Theory is found to be contradicted by these data in the same way as it is contradicted by the economic growth in Africa, Asia, former USSR, Western Europe, Eastern Europe and by the world economic growth. Paradoxically, U…
Historical economic growth in countries of the former USSR is analysed. It is shown that Unified Growth Theory is contradicted by the data, which were used, but not analysed, during the formulation of this theory. Unified Growth Theory does not explain the mechanism of economic growth. It explains the mechanism of Malt…
From positions, attained by modern theoretical physics in understanding of the universe bases, the methodological and philosophical analysis of fundamental physical concepts and their formal and informal connections with the real economic measurings is carried out. Procedures for heterogeneous economic time determinati…
Developing an AI economist agent using RAG, knowledge graphs, and LLMs for economic scenario analysis.
In this article, we address the question of how non-knowledge about future events that influence economic agents' decisions in choice settings has been formally represented in economic theory up to date. To position our discussion within the ongoing debate on uncertainty, we provide a brief review of historical develop…
The new business paradigms originate a strong necessity to re-think the theory of the firm with the aim to get a better understanding on the organizational and functional principles of the firm, operating in the investment economies in the prosperous societies. In this connection, we make the innovative research to adv…
The Unified Growth Theory is a puzzling collection of myths based on illusions created by hyperbolic distributions. Some of these myths are discussed. The examination of data shows that the three stages of growth (Malthusian Regime, Post-Malthusian Regime and Modern Growth Regime) did not exist and that Industrial Revo…
In this article we will show that the Macro-Economy and its growth can be modelled and explained exactly in principle by commonly known Field Theory from theoretical physics. We will show the main concepts and calculations needed and show that calculation and prediction of economic growth then gets indeed possible in D…
Price and return predictions are limited by economic complexity, not just volatility.
Second-order economic theory considers new variables to improve price volatility predictions.
Historical economic growth in Asia (excluding Japan) is analysed. It is shown that Unified Growth Theory is contradicted by the data, which were used (but not analysed) during the formulation of this theory. Unified Growth Theory does not explain the mechanism of economic growth. It explains the mechanism of Malthusian…
Dynamic model improves static economics by incorporating time effects.
We present an overview of some representative Agent-Based Models in Economics. We discuss why and how agent-based models represent an important step in order to explain the dynamics and the statistical properties of financial markets beyond the Classical Theory of Economics. We perform a schematic analysis of several m…
Mean Field Games applied to finance and economics.
Artificial intelligence has impacted many aspects of human life. This paper studies the impact of artificial intelligence on economic theory. In particular we study the impact of artificial intelligence on the theory of bounded rationality, efficient market hypothesis and prospect theory.
We study association between macroeconomic news and stock market returns using the statistical theory of copulas, and a new comprehensive measure of news based on the indexing of news wires. We find the impact of economic news on equity returns to be nonlinear and asymmetric. In particular, controlling for economic con…
The seriousness of the current crisis urgently demands new economic thinking that breaks the austerity vs. deficit spending circle in economic policy. The core tenet of the paper is that the most important problems that natural and social science are facing today are inverse problems, and that a new approach that goes …
We test a historical price time series in a financial market (the NASDAQ 100 index) for a statistical property known as detailed balance. The presence of detailed balance would imply that the market can be modeled by a stochastic process based on a Markov chain, thus leading to equilibrium. In economic terms, a positiv…
The last financial and economic crisis demonstrated the dysfunctional long-term effects of aggressive behaviour in financial markets. Yet, evolutionary game theory predicts that under the condition of strategic dependence a certain degree of aggressive behaviour remains within a given population of agents. However, as …
'Ergodicity economics' is criticized as pseudoscience.
A new constructivist approach to modeling in economics and theory of consciousness is proposed. The state of elementary object is defined as a set of its measurable consumer properties. A proprietor's refusal or consent for the offered transaction is considered as a result of elementary economic measurement. Elementary…
In recent years, methods from network science are gaining rapidly interest in economics and finance. A reason for this is that in a globalized world the interconnectedness among economic and financial entities are crucial to understand and networks provide a natural framework for representing and studying such systems.…
Study adds memory effect to Solow-Swan model for more accurate economic growth modeling.
The present paper analyses the formal parallelism existing between the laws of thermodynamics and some economic principles. Based on previous works, we shall show how the existence in Economics of principles analogous to those in thermodynamics involves the occurrence of economic events that remind of well-known phenom…
A simple but useful method of reciprocal values is introduced, explained and illustrated. This method simplifies the analysis of hyperbolic distributions, which are causing serious problems in the demographic and economic research. It allows for a unique identification of hyperbolic distributions and for unravelling co…
One of the fundamental postulates of the Unified Growth Theory is the claimed existence of three distinctly different regimes of economic growth governed by three distinctly different mechanisms of growth. However, Galor also proposed that the timing of these regimes is different for developed countries and for less-de…
We analyze the relationships between game theory and quantum mechanics and the extensions to statistical physics and information theory. We use certain quantization relationships to assign quantum states to the strategies of a player. These quantum states are contained in a density operator which describes the new quan…
Investigates financial and economic systems using statistical mechanics and information theory.
In economics literature, it is accepted that all people are rational and they try to maximize their utilities as possible as they can. In addition, economic theories are formed with the assumptions not suitable to real life. For instance, indifference curves are drawn with the assumptions that there are two goods, peop…
We review some methods recently used in the literature to detect the existence of a certain degree of common behavior of stock returns belonging to the same economic sector. Specifically, we discuss methods based on random matrix theory and hierarchical clustering techniques. We apply these methods to a set of stocks t…
Paper proposes a framework for token economy simulation and wealth distribution.
Although classical economic theory is based on the concept of stable equilibrium, real economic systems appear to be always out of equilibrium. Indeed, they share many of the dynamical features of other complex systems, e.g., ecological food-webs. We focus on the relation between increasing complexity of the economic n…
The study examines how market trade randomness influences price and return volatility.
The optimal approach is to theorize after examining data, not before.
Introduces a new price measure and a second-order economic theory for volatility forecasting.
We study a class of heterogeneous agent-based models which are based on a basic set of principles, and the most fundamental operations of an economic system: trade and product transformations. A basic guiding principle is scale invariance, which means that the dynamics of the economy should not depend on the units used…
Some optimization or equilibrium problems involving somehow the concept of optimal transport are presented in these notes, mainly devoted to applications to economic and game theory settings. A variant model of transport, taking into account traffic congestion effects is the first topic, and it shows various links with…
Game theory helps analyze ESOs/EBIs in production and service sectors.
Notions of Darwinian selection have been implicit in economic theory for at least sixty years. Richard Nelson and Sidney Winter have argued that while evolutionary thinking was prevalent in prewar economics, the postwar Neoclassical school became almost entirely preoccupied with equilibrium conditions and their mathema…
In science and especially in economics, agent-based modeling has become a widely used modeling approach. These models are often formulated as a large system of difference equations. In this study, we discuss two aspects, numerical modeling and the probabilistic description for two agent-based computational economic mar…
Linear stochastic models and discretized kinetic theory are two complementary analytical techniques used for the investigation of complex systems of economic interactions. The former employ Langevin equations, with an emphasis on stock trade; the latter is based on systems of ordinary differential equations and is bett…
These notes discuss several topics in neoclassical economics and alternatives, with an aim of reviewing fundamental issues in modeling economic markets. I start with a brief, non-rigorous summary of the basic Arrow-Debreu model of general equilibrium, as well as its extensions to include time and contingency. I then ar…
The fundamental purpose of the present research article is to introduce the basic principles of Dimensional Analysis in the context of the neoclassical economic theory, in order to apply such principles to the fundamental relations that underlay most models of economic growth. In particular, basic instruments from Dime…
More than thirty years ago, Charnes, Cooper and Schinnar (1976) established an enlightening contact between economic production functions (EPFs) -- a cornerstone of neoclassical economics -- and information theory, showing how a generalization of the Cobb-Douglas production function encodes homogeneous functions. As ex…
A new constructivist approach to modeling in economics and theory of consciousness is proposed. The state of elementary object is defined as a set of its measurable consumer properties. A proprietor's refusal or consent for the offered transaction is considered as a result of elementary economic measurement. We were al…
A relation between interest rates and inflation is presented using a two component economic model and a simple general principle. Preliminary results indicate a remarkable similarity to classical economic theories, in particular that of Wicksell.
Lie groups applied to tech progress in economic growth.