Published May 21, 2023, 1:20 a.m. by Naomi Charles
Quantum Economics and finance is a new and exciting field of study that explores the role of quantum mechanics in economic and financial systems. This interdisciplinary field of research is still in its infancy, but is already shedding new light on some of the most important questions in economics and finance.
One of the key insights of quantum economics and finance is that the behavior of economic and financial systems cannot be fully explained by classical economic theories alone. Quantum mechanics provides a new framework for understanding how these systems work, and how they might be manipulated to achieve desired outcomes.
In recent years, quantum economics and finance has been applied to a variety of problems, including the financial crisis of 2008 and the Euro crisis. These studies have shown that quantum effects can play a significant role in economic and financial systems, and that traditional approaches to these problems may need to be reconsidered in light of this new knowledge.
The field of quantum economics and finance is still in its early stages, but it has already begun to revolutionize our understanding of the economic and financial world. With further research, it is sure to provide even more insights into the workings of these complex systems.
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hello and welcome to this talk on
quantum economics and finance
quantum economics and finance uses
quantum mathematics to model phenomena
including cognition financial
transactions and the dynamics of money
and credit
and we'll be talking about topics
including why quantum in the first place
quantum probability and logic basics of
quantum computing
quantum cognition quantum walk quantum
game theory
quantum supply and demand threshold
effects
option pricing and the money bomb so why
quantum in the first place quantum
revolution
in physics was born when physicists
found that at the subatomic level energy
was always exchanged in terms of
discrete parcels
which they called quanta from the latin
for how much
in economics the equivalent is financial
transactions like when you buy an ice
cream in italy and you say
quanto costa which makes the quantum
connection a little clearer
so money behaves in some ways like an
object but not a classical one it shows
signature properties of quantum systems
such as
discreteness indeterminacy entanglement
duality
interference and so on perhaps the most
obvious such property is the
way that money jumps uh in in physics
irvine schrodinger
said if we have to go on with these
damned quantum jumps then i'm sorry that
i ever got involved
in with uh financial transactions of
course the same thing happens all the
time like when you tap your car to
destroy the money doesn't flow out
continuously it just
jumps in physics the
position of a particle is fundamentally
indeterminate and
is in a sense constructed by the
measurement procedure it's the same
thing
in markets if you push your house up for
sale you
will have a fuzzy idea of the price but
the actual
monetary value is only determined at the
moment of the sale
and this is money's job it's a way to
collapse value
down to number we often talk about money
but
one thing that isn't often emphasized is
just the
most basic feature which is is its
connection with numbers so if you look
at a
us dollar bill for example you see it
says
uh one numerical one and a word one in
each corner
so it's got quite a few ones and then
it's got uh
one dollar down at the bottom and a big
one in the middle and there's a lot more
ones on the other side
so they're really emphasizing the
connection with one and that is money's
most basic
property that it combines the properties
of an own thing
with a number these dual properties are
reflected in the two main historical
theories of money which are
bullionism money is gold and nothing
else is jp morgan's head
and chartalism which is the idea that
credit alone is money as alfred mitchell
instead
in the next year but then bitcoin comes
along and on the one hand it seems to be
completely virtual
but on the other hand it's also real as
you'll notice if you happen to
lose the hard drive in which your
bitcoins are located
and the duality of money therefore
uh is similar to the duality of light so
wave particle complementarity has been
reflected in theories of light go back
millennia
uh so aristotle thought light was a wave
and
newton thought it was uh particles and
sort of bounced back and forth until
finally um
the quantum theory came along and showed
that it has properties of both
at the same time it's the same with
money
um in in economics we're used to
treating preferences as
sort of fixed and known objects with
some
cognitive biases but often our
preferences are made up in response to
questions which act like a kind of a
measurement event so thoughts and ideas
behave in some ways like objects but
they're not classical objects
in physics bohr's theory of wave
particle complementarity
was actually inspired by the observation
from psychologists
that we can hold opposite ideas in the
mind at the same time
in superposition and in fact it's these
interference terms which play a very
important role
in quantum cognition as we'll see
in physics particles can mysteriously
become entangled so they act as a single
system and the financial system
will see a much more direct form of
entanglement where
financial assets and virtual liabilities
have these quantum characteristics
of entanglement
in economics uh there's this idea of
rational economic man is kind of like a
robot
the picture which is emerging from
quantum social science is a
quantum economic person who's entangled
indeterminate dynamic
paradoxical and alive as the philosopher
slavoy
zizek said a fact rarely notices that
you know quantum physics
appears to defy our common sense view of
material reality
but it seems to apply somewhat better to
uh the sort of human reality where the
human spirit
encounters itself outside itself
okay so pop quiz what is quantum
economics
is it a about discoveries that
economists have made by studying tiny
tiny amounts of money
no b about the idea that by attuning
ourselves with an evolving economic
consciousness field we can both get in
touch with the universe and become rich
no unfortunately c
physics envy taken to its logical
conclusion
no no there is a danger of that but as
we'll see the rest of these talks
really don't touch on physics very much
at all
or d about the idea that the money
system has quantum properties of its own
such as indeterminacy duality
interference and entanglement
which scale up and affect the economy as
a whole
the correct answer is of course d
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