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21 Oct 11
Originally posted by joe shmoWell, now that I think about it I guess debt cant be paralelled with entropy as some time there is "negative debt" in transactions
Is "debt" a sort of "entropy" in its scientific/mathematical model?
I'm not looking for general answers, but I would like to see something specific if possible ie math/physics/econimocs/biological..ect to argue "yay" or "nay"
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21 Oct 11
Originally posted by joe shmoCheck out
Is "debt" a sort of "entropy" in its scientific/mathematical model?
I'm not looking for general answers, but I would like to see something specific if possible ie math/physics/econimocs/biological..ect to argue "yay" or "nay"
http://en.wikipedia.org/wiki/Thermoeconomics
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22 Oct 11
Originally posted by JS357Its puzzleing to think that our whole economic and societal system, which we beleive has been "our abstract creation" could and most likely is governed by thermodynamics, and natural laws.
Check out
http://en.wikipedia.org/wiki/Thermoeconomics
22 Oct 11
Originally posted by joe shmoAny system whether in nature or created by us, will follow certain laws. Often those laws are at least in part a result of statistical effects or other common mathematical patterns. It is not surprising then that there are similarities between different systems and that analogies can be drawn. The mathematical branch 'Algebra' is all about studying such common pattern in their generality.
Its puzzleing to think that our whole economic and societal system, which we beleive has been "our abstract creation" could and most likely is governed by thermodynamics, and natural laws.
But one must always be careful with analogies not to go too far. If you see some similarities between two systems, it does not always mean it is valid to apply all the rules of one to the other. There must be justification for doing so, and it must be able to stand up to scrutiny.
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22 Oct 11
One has to be careful here to draw distinctions between a theory of economics and a model of
specific situations.
A theory is supposed to explain how and why a system works.
A model is more like a black box where you put the initial conditions in and turn the handle
and get the result back out. The internal workings don't have to have any barring on how
in reality the system works as long as in the applied situation the outputs you receive match
the result in reality.
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22 Oct 11
Originally posted by twhiteheadAre you purposing that this 'thermoeconomic model' is just a black box (as googlefudge stated)?
Any system whether in nature or created by us, will follow certain laws. Often those laws are at least in part a result of statistical effects or other common mathematical patterns. It is not surprising then that there are similarities between different systems and that analogies can be drawn. The mathematical branch 'Algebra' is all about studying such c ...[text shortened]... other. There must be justification for doing so, and it must be able to stand up to scrutiny.
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22 Oct 11
Originally posted by joe shmoAccording to economists, perhaps. Who knows what they think? Ask ten economists a question, and you'll get at least eleven answers, at most one of which will be provable (and probably provable wrong).
Is "debt" a sort of "entropy" in its scientific/mathematical model?
I'm not looking for general answers, but I would like to see something specific if possible ie math/physics/econimocs/biological..ect to argue "yay" or "nay"
According to science, sheesh no. For one, entropy is constantly increasing in a closed system. Is debt? Guaranteed? Then to whom is that debt, in a closed(!) economy? For another, entropy has a certain relation to energy. What is the economic equivalent of energy? Money is the easy answer, but it won't wash: debt is, in essence, negative money (it's money I owe someone rather than money I have), while entropy is certainly nothing like negative energy.
Richard
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22 Oct 11
Originally posted by Shallow Bluelets say I give you 10 dollars for some good, and then I make 5 dollars from re-selling that good,what recieves the difference...the economy?
According to economists, perhaps. Who knows what they think? Ask ten economists a question, and you'll get at least eleven answers, at most one of which will be provable (and probably provable wrong).
According to science, sheesh no. For one, entropy is constantly increasing in a closed system. Is debt? Guaranteed? Then to whom is that debt, i ...[text shortened]... ather than money I have), while entropy is certainly nothing like negative energy.
Richard
23 Oct 11
Originally posted by joe shmoIf we're to take the entropy analogy seriously, then there should be some sort of loss (expressible in economic terms) attending every economic transaction. There is some sort of loss that attends every deviation from Pareto-optimality. But that is analytic; it's what defines Pareto-optimality. If I exchange $5 for your frosty pint of beer, and I value it at $5 and you do too, then is there something lost in the exchange? Is there some higher-order notion of value here that function independently of what we, the exchangers, believe, and independently of what the market has established as a going price for pints? I guess I'm just confused here.
lets say I give you 10 dollars for some good, and then I make 5 dollars from re-selling that good,what recieves the difference...the economy?
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24 Oct 11
Originally posted by bbarrI guess I'm being lazy in not doing the research, but roughly how many countries/kingdoms/empires in the past/present historically failed because of debt?
If we're to take the entropy analogy seriously, then there should be some sort of loss (expressible in economic terms) attending every economic transaction. There is some sort of loss that attends every deviation from Pareto-optimality. But that is analytic; it's what defines Pareto-optimality. If I exchange $5 for your frosty pint of beer, and I value it a ...[text shortened]... what the market has established as a going price for pints? I guess I'm just confused here.
24 Oct 11
Originally posted by joe shmoI have no idea. Is debt supposed to be the economic analog of entropy? If so, then the analogy seems very, very rough. Many economic transactions do not result in debt, debt can be strategically run in order to increase economic power (as when one builds credit), debt can be forgiven, etc.
I guess I'm being lazy in not doing the research, but roughly how many countries/kingdoms/empires in the past/present historically failed because of debt?
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24 Oct 11
2 edits
Originally posted by bbarrYeah, I didn't say that debt "is" analogous to entropy, It was just a gut feeling that a had during the original thought. I threw that out on my second post because I couldn't rectify it with profit (negative debt)...
I have no idea. Is debt supposed to be the economic analog of entropy? If so, then the analogy seems very, very rough. Many economic transactions do not result in debt, debt can be strategically run in order to increase economic power (as when one builds credit), debt can be forgiven, etc.
I hadn't known of the "thermoeconomic model" until JS357 pointed it out to me, so im really not sure what the actual analogies are.
however, I may have been a little hasty in my ( probably just as hasty as I was drawing the debt/entropy analog in the first place) denial of it, as if memory serves correctly, the second law only forbodes negative entropy in any 'real' process. Is the economics a 'real' system as far as the natural laws go?