A Quantum-Inspired Economic Equilibrium Model: Incorporating Uncertainty in Price and Money Flow Dynamics

HARIT, ADITYA (2024): A Quantum-Inspired Economic Equilibrium Model: Incorporating Uncertainty in Price and Money Flow Dynamics.

Abstract

This paper presents a quantum-inspired economic equilibrium model that incorporates fundamental uncertainty in market dynamics. Drawing upon the analogy between quantum mechanics and economic behavior, the model defines an uncertainty constant, σ, which limits the precision with which both price and money flow can be simultaneously predicted. The model investigates the dynamics of price and money f low as they asymptotically approach equilibrium, constrained by the uncertainty principle ∆P · ∆M ≥ σ. Solutions for price and money f low are derived, and the behavior of the system as it reaches equilibrium is analyzed, offering a novel perspective on how markets behave in the presence of irreducible uncertainty.

• Item Type: MPRA Paper
• Language: English
• Keywords: Quantum economics, uncertainty, equilibrium, price dynamics, money flow, financial markets
• Subjects: A - General Economics and Teaching > A1 - General Economics; C - Mathematical and Quantitative Methods > C0 - General; E - Macroeconomics and Monetary Economics > E0 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development; P - Economic Systems > P4 - Other Economic Systems > P40 - General

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