Asymmetric information and macroeconomic dynamics

Raymond J. Hawkins, Masanao Aoki and B. Roy Frieden

Physica A: Statistical Mechanics and its Applications, 2010, vol. 389, issue 17, 3565-3571

Abstract: We show how macroeconomic dynamics can be derived from asymmetric information. As an illustration of the utility of this approach we derive the equilibrium density, non-equilibrium densities and the equation of motion for the response to a demand shock for productivity in a simple economy. Novel consequences of this approach include a natural incorporation of time dependence into macroeconomics and a common information-theoretic basis for economics and other fields seeking to link micro-dynamics and macro-observables.

Keywords: Macroeconomics; Asymmetric information; Fisher information; Productivity (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:389:y:2010:i:17:p:3565-3571

DOI: 10.1016/j.physa.2010.04.032

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