IDEAS home Printed from https://ideas.repec.org/p/voc/wpaper/tefprv2007.html
   My bibliography  Save this paper

A Thermodynamic Theory of Economics

Author

Listed:
  • John Bryant

    (Vocat International)

Abstract

An analogy between thermodynamic and economic theories and processes is developed further, following a previous paper published by the author in 1982. Economic equivalents are set out concerning the ideal gas equation, the gas constant, pressure, temperature, entropy, work done, specific heat and the 1st and 2nd Laws of Thermodynamics. The law of diminishing marginal utility was derived from thermodynamic first principles. Conditions are set out concerning the relationship of economic processes to entropic gain. A link between the Le Chatelier principle and economic processes is developed, culminating in a derivation of an equation similar in format to that of Cobb Douglas production function, but with an equilibrium constant and a disequilibrium function added to it. A trade cycle is constructed, utilising thermodynamic processes, and equations are derived for cycle efficiency, growth and entropy gain. A thermodynamic model of a money system is set out, and an attempt is made to relate interest rates, the rate of return, money demand and the velocity of circulation to entropy gain. Aspects concerning the measurement of economic value in thermodynamic terms are discussed.

Suggested Citation

  • John Bryant, 2007. "A Thermodynamic Theory of Economics," Working Papers tefprv2007, Economic Consultancy, Vocat International.
    • Handle: RePEc:voc:wpaper:tefprv2007
    as

    Download full text from publisher

    File URL: http://www.vocat.co.uk/TEFPRV2007.pdf
    File Function: Final post review version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bryant, J., 1982. "A thermodynamic approach to economics," Energy Economics, Elsevier, vol. 4(1), pages 36-50, January.
    2. Geoffrey P. Hammond, 2004. "Engineering Sustainability: Thermodynamics, Energy Systems and the Environment," Palgrave Macmillan Books, in: Adrian Winnett (ed.), Towards an Environment Research Agenda, chapter 8, pages 175-210, Palgrave Macmillan.
    3. Geoffrey P. Hammond & Adrian B. Winnett, 2004. "Some Interdisciplinary Perspectives on Environmental Appraisal and Valuation," Palgrave Macmillan Books, in: Adrian Winnett (ed.), Towards an Environment Research Agenda, chapter 1, pages 3-33, Palgrave Macmillan.
    4. Sousa, Tania & Domingos, Tiago, 2006. "Is neoclassical microeconomics formally valid? An approach based on an analogy with equilibrium thermodynamics," Ecological Economics, Elsevier, vol. 58(1), pages 160-169, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:voc:wpaper:tech52012 is not listed on IDEAS
    2. repec:voc:wpaper:tech82012 is not listed on IDEAS
    3. repec:voc:wpaper:tech72012 is not listed on IDEAS
    4. Jing Chen, 2013. "Population, Migration, Living Standard and Social Pressure: A Modeling Approach from Thermodynamics," Interdisciplinary Description of Complex Systems - scientific journal, Croatian Interdisciplinary Society Provider Homepage: http://indecs.eu, vol. 11(3), pages 345-349.
    5. repec:voc:wpaper:tech22012 is not listed on IDEAS
    6. John Bryant, 2008. "Thermodynamics and the Economic Process," Working Papers ten62008, Economic Consultancy, Vocat International.
    7. repec:voc:wpaper:tech12012 is not listed on IDEAS
    8. repec:voc:wpaper:tech32012 is not listed on IDEAS
    9. repec:voc:wpaper:tech62012 is not listed on IDEAS
    10. John Bryant, 2010. "A Thermodynamic Approach to Monetary Economics. A Revision. An application to the UK Economy 1969-2006 and the USA Economy 1966-2006," Working Papers ten5a2010, Economic Consultancy, Vocat International.
    11. repec:voc:wpaper:tech92012 is not listed on IDEAS
    12. George, Michael, 2007. "Predicting the Profit Potential of a Microeconomic Process: An Information Theoretic/Thermodynamic Approach," MPRA Paper 4816, University Library of Munich, Germany.
    13. repec:voc:wpaper:tech42012 is not listed 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. John Bryant, 2008. "Thermodynamics and the Economic Process," Working Papers ten62008, Economic Consultancy, Vocat International.
    2. repec:voc:wpaper:tech32012 is not listed on IDEAS
    3. repec:voc:wpaper:tech42012 is not listed on IDEAS
    4. repec:voc:wpaper:tech72012 is not listed on IDEAS
    5. repec:voc:wpaper:tech62012 is not listed on IDEAS
    6. Hammond, Geoffrey P., 2009. "Industrial energy analysis, thermodynamics and sustainability," Applied Energy, Elsevier, vol. 84(7-8), pages 675-700, July.
    7. repec:voc:wpaper:tech92012 is not listed on IDEAS
    8. repec:voc:wpaper:tech82012 is not listed on IDEAS
    9. repec:voc:wpaper:tech52012 is not listed on IDEAS
    10. repec:voc:wpaper:tech12012 is not listed on IDEAS
    11. repec:voc:wpaper:tech22012 is not listed on IDEAS
    12. 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.
    13. Foster, John, 2011. "Energy, aesthetics and knowledge in complex economic systems," Journal of Economic Behavior & Organization, Elsevier, vol. 80(1), pages 88-100.
    14. A. Madureira & F. Hartog & N. Baken, 2016. "A holonic framework to understand and apply information processes in evolutionary economics: survey and proposal," Netnomics, Springer, vol. 17(2), pages 157-190, September.
    15. 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.
    16. Marc A. Rosen, 2012. "Engineering Sustainability: A Technical Approach to Sustainability," Sustainability, MDPI, vol. 4(9), pages 1-23, September.
    17. Gasparatos, Alexandros & El-Haram, Mohamed & Horner, Malcolm, 2009. "Assessing the sustainability of the UK society using thermodynamic concepts: Part 1," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(5), pages 1074-1081, June.
    18. Geoffrey P Hammond & Hayley R Howard & Andrew Tuck, 2012. "Risk assessment of UK biofuel developments within the rapidly evolving energy and transport sectors," Journal of Risk and Reliability, , vol. 226(5), pages 526-548, October.
    19. Nuno Quental & Júlia Lourenço & Fernando da Silva, 2011. "Sustainability: characteristics and scientific roots," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 13(2), pages 257-276, April.
    20. Hakawati, Rawan & Smyth, Beatrice M. & McCullough, Geoffrey & De Rosa, Fabio & Rooney, David, 2017. "What is the most energy efficient route for biogas utilization: Heat, electricity or transport?," Applied Energy, Elsevier, vol. 206(C), pages 1076-1087.
    21. Gasparatos, Alexandros & El-Haram, Mohamed & Horner, Malcolm, 2009. "A longitudinal analysis of the UK transport sector, 1970-2010," Energy Policy, Elsevier, vol. 37(2), pages 623-632, February.
    22. Müller, Matthias Otto & Stämpfli, Adrian & Dold, Ursula & Hammer, Thomas, 2011. "Energy autarky: A conceptual framework for sustainable regional development," Energy Policy, Elsevier, vol. 39(10), pages 5800-5810, October.
    23. McKenna, R. & Bertsch, V. & Mainzer, K. & Fichtner, W., 2018. "Combining local preferences with multi-criteria decision analysis and linear optimization to develop feasible energy concepts in small communities," European Journal of Operational Research, Elsevier, vol. 268(3), pages 1092-1110.
    24. Carolino, Cristina Guedes & Medeiros Ferreira, João Paulo, 2013. "First and second law analyses to an energetic valorization process of biogas," Renewable Energy, Elsevier, vol. 59(C), pages 58-64.
    25. Dyer, Caroline H. & Hammond, Geoffrey P. & Jones, Craig I. & McKenna, Russell C., 2008. "Enabling technologies for industrial energy demand management," Energy Policy, Elsevier, vol. 36(12), pages 4434-4443, December.
    26. Chen, Shaoqing & Chen, Bin, 2014. "Energy efficiency and sustainability of complex biogas systems: A 3-level emergetic evaluation," Applied Energy, Elsevier, vol. 115(C), pages 151-163.
    27. Teijo Palander & Hanna Haavikko & Emma Kortelainen & Kalle Kärhä, 2020. "Comparison of Energy Efficiency Indicators of Road Transportation for Modeling Environmental Sustainability in “Green” Circular Industry," Sustainability, MDPI, vol. 12(7), pages 1-22, March.
    28. El-Shafie, Mostafa & Kambara, Shinji & Hayakawa, Yukio & Hussien, A.A., 2021. "Integration between energy and exergy analyses to assess the performance of furnace regenerative and ammonia decomposition systems," Renewable Energy, Elsevier, vol. 175(C), pages 232-243.
    29. Geoffrey P. Hammond, 2006. "‘People, planet and prosperity’: The determinants of humanity's environmental footprint," Natural Resources Forum, Blackwell Publishing, vol. 30(1), pages 27-36, February.

    More about this item

    Keywords

    Thermodynamics; economics; Le Chatelier; entropy; utility; money; equilibrium; value; energy;
    All these keywords.

    JEL classification:

    • A1 - General Economics and Teaching - - General Economics
    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • E - Macroeconomics and Monetary Economics
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

    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:voc:wpaper:tefprv2007. 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: John Bryant (email available below). General contact details of provider: http://www.vocat.co.uk .

    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.