Unknown

Dataset Information

0

Quantum Propensity in Economics.


ABSTRACT: This paper describes an approach to economics that is inspired by quantum computing, and is motivated by the need to develop a consistent quantum mathematical framework for economics. The traditional neoclassical approach assumes that rational utility-optimisers drive market prices to a stable equilibrium, subject to external perturbations or market failures. While this approach has been highly influential, it has come under increasing criticism following the financial crisis of 2007/8. The quantum approach, in contrast, is inherently probabilistic and dynamic. Decision-makers are described, not by a utility function, but by a propensity function which specifies the probability of transacting. We show how a number of cognitive phenomena such as preference reversal and the disjunction effect can be modelled by using a simple quantum circuit to generate an appropriate propensity function. Conversely, a general propensity function can be quantized, via an entropic force, to incorporate effects such as interference and entanglement that characterise human decision-making. Applications to some common problems and topics in economics and finance, including the use of quantum artificial intelligence, are discussed.

SUBMITTER: Orrell D 

PROVIDER: S-EPMC8795949 | biostudies-literature |

REPOSITORIES: biostudies-literature

Similar Datasets

| S-EPMC7418754 | biostudies-literature
| S-EPMC3858957 | biostudies-literature
| S-EPMC4570787 | biostudies-literature
| S-EPMC8594813 | biostudies-literature
| S-EPMC4252154 | biostudies-other
| S-EPMC8362201 | biostudies-literature
| S-EPMC3086182 | biostudies-literature
| S-EPMC8190309 | biostudies-literature
2021-01-30 | GSE165805 | GEO
| S-EPMC4581401 | biostudies-other