Monday, January 1, 2018

New paper up at SSRN

I put a new paper up at SSRN (Maximum entropy and information theory approaches to economics) that I believe is accessible despite currently being under review that's been accepted and is no longer under review:

It covers some of the material I've covered in presentations (collected here), but with a lot more details and explanations. It also contains the derivation of my favorite equation I've come up with here:

That's probably the best shot I'll get at an equation I could engrave on my tombstone.


  1. Noting a couple of typos:

    1. First equation of Sec. 4.1 should be ~ exp(⟨k⟩ γ t)
    2. Subject verb agreement in second paragraph of introduction
    3. Wrong quotes around "center of mass" in introduction
    4. Last bullet point of introduction "manifest some rational microeconomic behavior"
    5. "The information required to specify the spatial, temporal ... is equal to the information required to specify ..." Section 2, page 4.
    6. Sec 2.1, 1st paragraph. Reference agnostic approach mentioned in figure caption and cite "A Theory of Market Efficiency" Anup Rao (2017) as an example of a theory explaining how the information flows.
    7. Cite Gronwall, Thomas H. (1919), "Note on the derivatives with respect to a parameter of the solutions of a system of differential equations", Ann. of Math., 20 (2): 292–296
    8. After Eq. 4.3, define b = (B - B0)/B0
    9. Eq. 4.1: ∑Ai ~ log Amax at the beginning
    10. Page 17: Add example of well-defined k(1), k(2) being e.g. Solow model production function exponents
    11. Add lambda to Eq. 3.4 defining alpha: α = (k - 1) λ
    12. In summary, add reference to connection of IT index with Lyapunov exponent and add citation to:

    Todd Zorick and Jason Smith, “Generalized Information Equilibrium Approaches to EEG Sleep Stage Discrimination,” Computational and Mathematical Methods in Medicine, vol. 2016, Article ID 6450126, 8 pages, 2016. doi:10.1155/2016/6450126

    1. First line of equation 4.5 should have a d/dB after the \equiv

    2. These have all been fixed in the latest version available at the same link.


Comments are welcome. Please see the Moderation and comment policy.

Also, try to avoid the use of dollar signs as they interfere with my setup of mathjax. I left it set up that way because I think this is funny for an economics blog. You can use € or £ instead.