IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2201.07975.html
   My bibliography  Save this paper

Effect Structure and Thermodynamics Formulation of Demand-side Economics

Author

Listed:
  • Burin Gumjudpai

    (NAS Mahidol University)

Abstract

We propose concept of equation of state (EoS) effect structure in form of diagrams and rules. This concept helps justifying EoS status of an empirical relation. We apply the concept to closed system of consumers and we are able to formulate its EoS. According to the new concept, EoS are classified into three classes. Manifold space of thermodynamics formulation of demand-side economics is identified. Formal analogies of thermodynamics and economics consumers' system are made. New quantities such as total wealth, generalized utility and generalized consumer surplus are defined. Microeconomics' concept of consumer surplus is criticized and replaced with generalized consumer surplus. Smith's law of demand is included in our new paradigm as a specific case resembling isothermal process. Absolute zero temperature state resembles the nirvana state in Buddhism philosophy. Econometric modelling of consumers' EoS is proposed at last.

Suggested Citation

  • Burin Gumjudpai, 2021. "Effect Structure and Thermodynamics Formulation of Demand-side Economics," Papers 2201.07975, arXiv.org.
    • Handle: RePEc:arx:papers:2201.07975
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2201.07975
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sousa, Tânia & Domingos, Tiago, 2006. "Equilibrium econophysics: A unified formalism for neoclassical economics and equilibrium thermodynamics," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 371(2), pages 492-512.
    2. repec:cup:cbooks:9780521265140 is not listed on IDEAS
    3. Burin Gumjudpai, 2018. "Towards equation of state for a market: A thermodynamical paradigm of economics," Papers 1807.09595, arXiv.org, revised Jul 2018.
    4. Smith, Eric & Foley, Duncan K., 2008. "Classical thermodynamics and economic general equilibrium theory," Journal of Economic Dynamics and Control, Elsevier, vol. 32(1), pages 7-65, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rashkovskiy, S.A., 2021. "Thermodynamics of markets," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 567(C).
    2. Sergey Rashkovskiy, 2020. "Thermodynamics of markets," Papers 2010.10260, arXiv.org.
    3. Rashkovskiy, S.A., 2021. "Economic thermodynamics," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 582(C).
    4. Burin Gumjudpai & Yuthana Sethapramote, 2019. "Nature of thermodynamics equation of state towards economics equation of state," Papers 1907.07108, arXiv.org.
    5. Catalano, Michele & Di Guilmi, Corrado, 2019. "Uncertainty, rationality and complexity in a multi-sectoral dynamic model: The dynamic stochastic generalized aggregation approach," Journal of Economic Behavior & Organization, Elsevier, vol. 157(C), pages 117-144.
    6. Christoph J. Borner & Ingo Hoffmann & John H. Stiebel, 2024. "A closer look at the chemical potential of an ideal agent system," Papers 2401.09233, arXiv.org.
    7. repec:voc:wpaper:tech82012 is not listed on IDEAS
    8. Friedrich Wagner, 2011. "Market clearing by maximum entropy in agent models of stock markets," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 6(2), pages 121-138, November.
    9. Venkatasubramanian, Venkat & Luo, Yu & Sethuraman, Jay, 2015. "How much inequality in income is fair? A microeconomic game theoretic perspective," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 435(C), pages 120-138.
    10. Winkler, Julian, 2023. "Managing fundamentals versus preferences: Re-balancing portfolios and stock returns," MPRA Paper 119149, University Library of Munich, Germany.
    11. Nielsen, S.N. & Müller, F., 2009. "Understanding the functional principles of nature—Proposing another type of ecosystem services," Ecological Modelling, Elsevier, vol. 220(16), pages 1913-1925.
    12. Roma, Antonio & Pirino, Davide, 2009. "The extraction of natural resources: The role of thermodynamic efficiency," Ecological Economics, Elsevier, vol. 68(10), pages 2594-2606, August.
    13. Arthur Matsuo Yamashita Rios de Sousa & Hideki Takayasu & Misako Takayasu, 2017. "Detection of statistical asymmetries in non-stationary sign time series: Analysis of foreign exchange data," PLOS ONE, Public Library of Science, vol. 12(5), pages 1-18, May.
    14. Caticha, Ariel & Golan, Amos, 2014. "An entropic framework for modeling economies," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 408(C), pages 149-163.
    15. Anirban Chakraborti & Dhruv Raina & Kiran Sharma, 2016. "Can an interdisciplinary field contribute to one of the parent disciplines from which it emerged?," Papers 1605.08354, arXiv.org.
    16. Foley, Duncan K., 2010. "What's wrong with the fundamental existence and welfare theorems?," Journal of Economic Behavior & Organization, Elsevier, vol. 75(2), pages 115-131, August.
    17. repec:spo:wpecon:info:hdl:2441/eu4vqp9ompqllr09hc01g3029 is not listed on IDEAS
    18. Erhard Glötzl & Florentin Glötzl & Oliver Richters, 2019. "From constrained optimization to constrained dynamics: extending analogies between economics and mechanics," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 14(3), pages 623-642, September.
    19. repec:voc:wpaper:tech32012 is not listed on IDEAS
    20. Karey Harrison, 2013. "Ontological Commitments of Ethics and Economics," Economic Thought, World Economics Association, vol. 2(1), pages 1-1, April.
    21. Friedrich, T., 2010. "The transfer space," MPRA Paper 23643, University Library of Munich, Germany.
    22. 'Eric Herbert & and Gael Giraud & Aur'elie Louis-Napol'eon & Christophe Goupil, 2022. "Macroeconomic Dynamics in a finite world: the Thermodynamic Potential Approach," Papers 2204.02038, arXiv.org, revised May 2022.
    23. Chiarella Carl & Di Guilmi Corrado, 2015. "The limit distribution of evolving strategies in financial markets," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 19(2), pages 137-159, April.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2201.07975. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.