Golden ratio of invisible hand: does the gravitation matter?

Malakhov, Sergey (2021): Golden ratio of invisible hand: does the gravitation matter?

Abstract

The recent paper on the Invisible hand proves the fact that its equilibrium is mathematically perfect. If the producer allocates his time between production and delivery to the ‘the door’ of the buyer with zero search costs and unintentionally maximizes customer’s consumption-leisure utility, both the marginal rate of transformation of production into delivery and the marginal rate of substitution of leisure for consumption become equal to the golden ratio conjugate whereas the sales-costs of production ratio becomes equal to the golden ratio itself, called once by Luca Pacioli, the founder of the modern accounting, as the divine proportion. Previous papers on Invisible hand formulated the hypothesis of the gravitation between sellers and buyers on commodity markets and between men and women in marriage markets. The golden ratio proves this hypothesis. At the equilibrium, gravitational fields of both seller and buyer as well as of both husband and wife are equal to the golden ratio conjugate. It means that any monopoly and monopsony really disappear. At the Invisible hand equilibrium, the transaction takes place between mutually attractive individuals. The equilibrium price stays competitive, but its economic nature is supported by the mutual respect of both parts in transaction.

• Item Type: MPRA Paper
• Language: English
• Keywords: golden ratio, invisible hand, gravitation, general competitive equilibrium
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics > D11 - Consumer Economics: Theory; D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search ; Learning ; Information and Knowledge ; Communication ; Belief ; Unawareness

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