Gauge field theory of market dynamics: Toward a solution of the "man vs. men" dilemma

Yingrui Yang ()

MPRA Paper from University Library of Munich, Germany

Abstract: The current economics and psychology are developed within the Newtonian tradition in physics from both conceptual and instrumental perspectives. This paper aims to integrate economics and cognitive science by applying gauge field theory of modern theoretical physics. Many controversies between normative theories and behavioral theories are characterized by the “man vs. men” dilemma. Gauge potential and gauge field strength is constructed at both the man-level and the men-level in order to satisfy the principle of gauge invariance. To maintain the Lagrangian density function invariant, the gauge transformations of the first kind and the second kind are performed at the man-level and the men-level, respectively. The market dynamics is modeled by the logic of electrodynamics. The interactions of the market and individual participants are formulated by the logic of electromagnetic coupling. In establishing the market dynamic equations, individual utility function serves as gauge function and efficiency provides gauge freedom.

Keywords: bounded rationality; economic rational man; electrodynamics; gauge theory; market dynamics; cognitive field (search for similar items in EconPapers)
JEL-codes: A1 A12 C0 C02 D0 D01 D03 (search for similar items in EconPapers)
Date: 2015-04-20, Revised 2015-06-11
New Economics Papers: this item is included in nep-evo, nep-hme and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Gauge field theory of market dynamics: Toward a solution of the "man vs. men" dilemma (2015)
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