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Economic law of increase of Kolmogorov complexity. Transition from financial crisis 2008 to the zero-order phase transition (social explosion)

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  • V. P. Maslov

Abstract

In Maslov (2003), a two level model of the occurrence of financial pyramid (bubbles) has been considered. We also considered the mathematical analogy of this model to Bose condensation. In the present paper, we explain why Ponzi schemes and bubbles result in a crisis in real economics. In Maslov (2005), the law of increase of entropy in financial systems, and consequently increase of Kolmogorov complexity, is formulated. If this law is broken, the financial system makes a phase transition to a different state. In Maslov (2005) the author considered a two level model of the zeroth-order phase transition which was interpreted in Maslov (2006) as an analog of social catastrophe. In the present paper we also examine this model.

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  • V. P. Maslov, 2008. "Economic law of increase of Kolmogorov complexity. Transition from financial crisis 2008 to the zero-order phase transition (social explosion)," Papers 0812.4737, arXiv.org.
    • Handle: RePEc:arx:papers:0812.4737
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    Cited by:

    1. Konov, Joshua Ioji, 2012. "Market Economy under Rapid Globalization and Rising Productivity," MPRA Paper 48750, University Library of Munich, Germany.

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