Causal Entropic Forces, Narratives and Self-organisation of Capital Markets

Romain Bocher

Journal of Interdisciplinary Economics, 2023, vol. 35, issue 2, 172-190

Abstract: The intersubjective markets hypothesis is revisited with respect to causal entropic principles. While the financial system is assumed to naturally evolve towards uncertainty, a spontaneous and unstable form of order emerges, thanks to narratives, leading to self-organised criticality. This article also includes a discussion about main hypotheses in finance, about the link between volatility spikes and entropy, and, finally, about the important role of narratives as forms of collective intelligence. JEL: D40, D50, D53, D70, D80

Keywords: Capital markets; intersubjectivity; entropic forces; thermodynamics; self-organised criticality; swarm intelligence (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jinter:v:35:y:2023:i:2:p:172-190

DOI: 10.1177/02601079211039321

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