Socio-economic utility and chemical potential

R\'emi Lemoy, Eric Bertin and Pablo Jensen

Papers from arXiv.org

Abstract: In statistical physics, the conservation of particle number results in the equalization of the chemical potential throughout a system at equilibrium. In contrast, the homogeneity of utility in socio-economic models is usually thought to rely on the competition between individuals, leading to Nash equilibrium. We show that both views can be reconciled by introducing a notion of chemical potential in a wide class of socio-economic models, and by relating it in a direct way to the equilibrium value of the utility. This approach also allows the dependence of utility across the system to be determined when agents take decisions in a probabilistic way. Numerical simulations of a urban economic model also suggest that our result is valid beyond the initially considered class of solvable models.

Date: 2010-10, Revised 2011-02
New Economics Papers: this item is included in nep-cmp and nep-upt
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Citations: View citations in EconPapers (4)

Published in EPL 93, 38002 (2011)

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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:1010.3225

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