Effective Rank and Dimensionality Reduction: From Complex Disaggregation Back to a Simple World

Lefteris Tsoulfidis ()

MPRA Paper from University Library of Munich, Germany

Abstract: In recent years there is a revival of political economy and discussions are about the near linearities of price rate of profit trajectories. In this article, we argue that the economy’s input-output data are of low effective dimensionality, meaning that there is overfitting of both data and dimensions and that the fundamental behavior of the economy can be tracked down with the use of a low dimensional system.

Keywords: Near-linearity; price trajectories; eigendecomposition; effective rank; Shannon entropy (search for similar items in EconPapers)
JEL-codes: B24 B51 C67 D46 D57 E11 E31 (search for similar items in EconPapers)
Date: 2022-04-12, Revised 2022-05-13
New Economics Papers: this item is included in nep-hme and nep-mac
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Related works:
Working Paper: Effective Rank and Dimensionality Reduction: from Complex Disaggregation Back to a Simple World (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:113068

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