Simple mechanism resolves economic puzzles.
problem High cyclically adjusted P/E ratio, wage vs. capital gains, equity premium persistence.
method Simple mechanism noted.
result Simple mechanism partially resolves economic puzzles.
On-device research index
arXiv research
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.
169,341 papers · 148 categories
Trend · papers per month
48 results for “economic puzzles”
Financial markets provide a natural quantitative lab for understanding some of the most advanced human behaviours. Among them is the use of mathematical tools known as financial instruments. Besides money, the two most fundamental financial instruments are bonds and equities. More than 30 years ago Mehra and Prescott f…
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…
SOC theory explains financial volatility and economic shocks.
problem Excess volatility and small shocks causing large disruptions.
method Explains system behavior at critical point with fat-tailed fluctuations.
result SOC theory offers a plausible solution to financial market volatility.
This short review presents a selected history of the mutual fertilization between physics and economics, from Isaac Newton and Adam Smith to the present. The fundamentally different perspectives embraced in theories developed in financial economics compared with physics are dissected with the examples of the volatility…
Exploring new approaches to explain the equity risk premium puzzle.
problem The equity risk premium is higher than expected, challenging conventional models.
method Reviewing and combining existing approaches to explain the anomaly.
result A fusion of approaches may provide a more realistic framework.
Quadratis Puzzlesmath.GT
New puzzles from geometry and topology.
problem Exploring puzzles from geometric and topological concepts.
method Construction from square-tiled shapes, discussion of underlying mathematics.
result Puzzles naturally associated to puzzle spaces.
We analyze higher-dimensional sliding puzzles, finding solvability patterns.
problem Solvability of higher-dimensional cubical sliding puzzles.
method Study of puzzle graphs and token movement constraints.
result Characterization of solvability regimes from stuck to fully solvable.
Deep neural network predicts puzzle piece adjacency.
problem Jigsaw puzzle assembly accuracy.
method Deep learning model trained on pixel data.
result Significant improvement in puzzle assembly accuracy.
AI predicts currency strength based on economic fundamentals, outperforming traditional methods.
problem Exchange rate disconnect puzzle documented by Meese and Rogoff (1983).
method Generative AI (ChatGPT and DeepSeek) forecasts currency returns using economic data.
result Simple trading strategy based on AI fundamentals outperforms traditional currency factors.
Model resolves asset pricing puzzles with price-impact.
problem Asset pricing puzzles like interest rate, stock-price volatility, and equity premium.
method Closed-form equilibrium model with exponential investors trading continuously and experiencing price-impact.
result Price-impact amplifies risk-sharing distortions, resolving puzzles.
Open geometry puzzles keep the author engaged.
problem Open problems in geometry that challenge the author.
method Collection of open problems based on puzzle-charm.
result No spare hands in solving the problems.
New distribution resolves excess volatility puzzle in finance.
problem Excess volatility in equity prices not explained by rational finance theory.
method Empirical analysis of historical returns using a new distribution.
result Volatility puzzle disappears when using a more appropriate return distribution.
In this article we prove the impossibility of some disentanglement puzzles, first building mathematical models that reflect the essential characteristics of these puzzles.
The puzzle that just isn'tecon.GN
Engel explains why interest rates, exchange rates, and inflation puzzles don't exist.
problem Explaining the canonical form of the interest rates, exchange rates, and inflation puzzles.
method Using the concept of a non-pecuniary liquidity return on assets.
result The forward premium puzzle just does not exist, at least not in its canonical form.
Repo pricing model explains haircut and spread dynamics.
problem Characterize and explain repo pricing measures.
method Develops a haircut model to identify economic capital as the main driver of repo pricing.
result Empirically reproduces repo haircut hikes and explains differences in haircut and spread.
New model solves equity premium puzzle with risk aversion coefficient.
problem Equity premium puzzle in financial markets.
method Developed a new model incorporating investor risk behavior, tested with specific coefficients.
result Validated model with empirical studies, confirming coefficient of 1.033526.
Puzzling the 120-cellmath.GT
We introduce Quintessence: a family of burr puzzles based on the geometry and combinatorics of the 120-cell. We discuss the regular polytopes, their symmetries, the dodecahedron as an important special case, the three-sphere, and the quaternions. We then construct the 120-cell, giving an illustrated survey of its geome…
New model solves equity premium puzzle.
problem Equity premium puzzle regarding risk behavior of investors.
method Developed a new tool called the sufficiency factor to analyze risk behavior of investors.
result Validated the new model with a coefficient of relative risk aversion of 1.033526.
Algorithm finds characteristic maps over complex shapes.
problem Finding non-singular characteristic maps over wedged simplicial complexes.
method Constructive puzzle algorithm based on linear algebra.
result Algorithm performs well compared to other methods.
Deep learning solves jigsaw puzzles by classifying fragment positions.
problem Automated reconstruction of archaeological fragments from jigsaw puzzles.
method Classifies relative positions of fragments using deep neural networks and local feature co-occurrences.
result Our method outperforms state-of-the-art by 25%.
The paper resolves behavioral finance objections to rational finance theory.
problem Predictability of asset returns, Equity Premium, Volatility Puzzle.
method Statistical models within rational finance theory.
result Offers resolutions to behavioral finance anomalies.
Sophisticated volatility models outperform naive portfolio strategies.
problem Improving mean-variance portfolio performance over the naive 1/N strategy.
method Investigated various econometric and portfolio models across multiple datasets.
result Most models achieve higher Sharpe ratios and lower portfolio volatility than the naive rule.
Solves equity premium puzzle with time-varying variables.
problem Equity premium puzzle.
method Consumption Capital Asset Pricing Model with time-varying subjective time discount factors.
result Calculated coefficient of relative risk aversion (CRRA) is around 4.40.
Solved Dudeney's 100-year-old puzzle about triangle to square dissection.
problem How to dissect an equilateral triangle into the fewest pieces to form a square.
method Reduced the problem to analyzing graph structures representing piece correspondences.
result Proved that four is the minimum number of pieces for an equilateral triangle to square dissection.
The geometry in Plato's Menomath.HO
The paper explains a geometry puzzle from Plato's Meno.
problem An ingenious geometry puzzle in Plato's Meno.
method Analysis from both ancient and modern geometric perspectives.
result Solves a 2,400-year-old geometry puzzle.
Paper defines conditions for feasible correlation matrices from factor structures.
problem Feasibility of option implied correlation matrices in non-FX markets.
method Quantitative and economic approaches to solve the nearest correlation matrix problem.
result Introduces methods to ensure feasible correlation matrices from factor structures.
Two operations transform simple polytopes with same manifold structure.
problem Transforming simple polytopes while maintaining a specific manifold structure.
method Biflip and puzzle-move operations on simple polytopes.
result Produced polytopes have diffeomorphic moment-angle manifolds.
Globalization is one of the central concepts of our age. The common perception of the process is that, due to declining communication and transport costs, distance becomes less and less important. However, the distance coefficient in the gravity model of trade, which grows in time, indicates that the role of distance i…
New method identifies precursors of financial crises in market correlation structures.
problem Predicting long-term financial crises in non-Markovian, non-stationary markets.
method Identifying quasi-stationary market states and their precursor properties.
result Certain features of market states show potential as indicators of financial crises.
Voluntary insurance contracts constitute a puzzle because they increase the expectation value of one party's wealth, whereas both parties must sign for such contracts to exist. Classically, the puzzle is resolved by introducing non-linear utility functions, which encode asymmetric risk preferences; or by assuming the p…
Paper solves annuity pricing puzzle by minimizing risk.
problem Inconsistency between theory and empirical observations in annuities pricing.
method Risk minimization approach to price annuities for both producer and customer.
result Different pricing solutions for annuity price and rate of payments.
An edge tessellation is a tiling of the plane generated by reflecting a polygon in its edges. We prove that a polygon generating an edge tessellation is one the following eight types: a rectangle; an equilateral, 60-right, isosceles right, or 120-isosceles triangle; a 120-rhombus; a 60-90-120 kite; or a regular hexagon…
Puzzle Mix optimizes mixup by leveraging saliency and local statistics.
problem Overfitting and adversarial vulnerability of deep networks.
method Puzzle Mix alternates between multi-label and saliency-based objectives for optimal mixing masks.
result Puzzle Mix outperforms other mixup methods in generalization and adversarial robustness.
Model learns to sort music clips in sequence.
problem Finding an optimal permutation of music clips.
method Proposed a music puzzle game for self-supervised learning of neural networks.
result Improved architecture (SEN) performs better on music medley.
PHYRE benchmark tests physics learning algorithms.
problem Developing efficient algorithms for physics reasoning.
method Simple classical mechanics puzzles in a 2D environment.
result Modern algorithms perform poorly on PHYRE.
Solves the equity premium puzzle without calibrated values.
problem Equity premium puzzle in finance.
method Derived new model from 4 different equations, found subjective time discount factor and coefficient of relative risk aversion.
result Calculated values and risk attitude determination align with empirical literature.
Galor's mysterious income growth rate is debunked, revealing data manipulation.
problem Mysterious sudden spurt in income per capita growth rate.
method Mathematical analysis of historical world economic growth data.
result The sudden spurt in income per capita growth rate is an artifact of data presentation.
A hybrid scheme uses GAs and DL for tile panel reconstruction.
problem Reconstructing Portuguese tile panels with real-world effects.
method Enhanced GA-based puzzle solver with novel DLCM.
result 82% accuracy for tile reconstruction compared to 3.5% for best known method.
New method makes robust estimators work without knowing corruption levels.
problem Robust estimation algorithms struggle with unknown corruption levels.
method Abstracted geometric puzzle solution to universal meta technique.
result Converts any robust estimator to work without corruption bounds.
Study shows trust and trustworthiness emerge through reinforcement learning.
problem Trust and trustworthiness are universal but not predicted by traditional economic models.
method Used Q-learning algorithm to simulate trust and trustworthiness dynamics in a trust game.
result High levels of trust and trustworthiness emerge when individuals consider both past and future experiences.
Study on CEF discount in Bangladesh, finds size and maturity impact, turnover negative.
problem Exploring the discount puzzle in closed-end mutual funds in Bangladesh.
method Fixed effects panel regression with diagnostic tests.
result Fund size and maturity positively impact CEF discount, turnover negatively impacts.
By using two different invariants for the Rubik's Magic puzzle, one of metric type, the other of topological type, we can dramatically reduce the universe of constructible configurations of the puzzle. Finding the set of actually constructible shapes remains however a challenging task, that we tackle by first reducing …
Unified theory explains housing cycle across metros, showing credit expansion impacts.
problem Puzzling correlations between income and mortgage growth across ZIP codes and metros.
method Unified credit expansion theory, double differences, instrumental variables.
result Credit expansion drives housing cycle, affecting boom, bust, and recovery phases.
Chess engines Stockfish and LCZero differ in their approach to solving endgame puzzles.
problem Comparing machine and human chess problem-solving abilities.
method Used Plaskett's Puzzle to compare Stockfish and LCZero's performance.
result Stockfish outperforms LCZero on the puzzle.
Model explains money creation under regulatory constraints.
problem Understanding money creation dynamics under regulatory pressures.
method Agent-based model of secured interbank network.
result Excess liquidity and repurchase agreements emerge due to regulatory constraints.
Deep networks generalize well due to hidden mechanisms like renormalization.
problem Generalization in deep learning networks.
method Analyzing RBMs and autoencoders, applying renormalization group principles.
result Deep networks can generalize well with fewer parameters than expected.
High quality topic extraction from business news explains abnormal financial market volatilitystat.ML
Understanding the mutual relationships between information flows and social activity in society today is one of the cornerstones of the social sciences. In financial economics, the key issue in this regard is understanding and quantifying how news of all possible types (geopolitical, environmental, social, financial, e…