Econophysics

The remarkable evolution of econophysics research has brought the deep synthesis of ideas derived from economics and physics to subjects as diverse as education, banking, finance, and the administration of large institutions. The original papers in this collection present a broad summary of these advances, written by interdisciplinary specialists. Included are studies on subjects in the development of econophysics; on the perspectives offered by econophysics on large problems in economics and finance, including the 2008-9 financial crisis; and on higher education and group decision making. The introductions and insights they provide will benefit everyone interested in applications of this new transdisciplinary science.

• Ten papers present an updated version of the origins, issues, and applications of econophysics
• Economics and finance chapters consider lessons learned from the 2008-9 financial crisis
• Sociophysics chapters propose new thinking on educational reforms and group decision making

Upper-division undergraduates, graduate students, and researchers in economics and finance

Dedication

List of Contributors

Part I: General Background of Econophysics

Chapter 1. History and Role of Econophysics in Scientific Research

1.1 Introduction

1.2 Relations between Economics and Physics

1.3 Relations between Economists and Physicists

1.4 History of Econophysics

1.5 Some Definitional Issues

1.6 Econophysics and Romanian Econophysicists

References

Further Reading

Chapter 2. Multidisciplinary Modeling Knowledge and Unidisciplinary Isolation

2.1 Introduction

2.2 Multidisciplinary Modeling

2.3 The Principles of Multidisciplinary Modeling

2.4 A Final Remark

References

Part II: Economics and Finance

Chapter 3. The Efficiency of Capital Markets: Hypothesis or Approximation

3.1 Introduction: Defining Market Efficiency

3.2 Test of Market Efficiency

3.3 Data and Procedure

3.4 Variability of Market Efficiency

3.5 Conclusions

Acknowledgments

References

Chapter 4. Nonlinear Mechanisms of Generating Power Laws in Socioeconomic Systems

4.1 What are the Power Laws?

4.2 Are the Stock Market Returns Gaussian Distributed?

4.3 Something About the Richest People in the World

4.4 From the Smallest Towns to the Largest Cities

4.5 What Mark Have You Got Today?

4.6 Conclusion

References

Chapter 5. Was It Possible to Forecast the Credit Crunch? (Monte Carlo Simulation of Integrated Market and Credit Risk)

5.1 Introduction

5.2 Introduction to Financial Theory

5.3 Methodology of Credit Drivers

5.4 Data Description and Analysis

5.5 Results and Summary

References

Chapter 6. A Quantum Mechanics Model May Explain the Infringement of Some Financial Rules in Spite of Stiff Supervision

6.1 Introduction

6.2 Classical Approach

6.3 Quantum Mechanical Approach: Schrödinger Representation

Reference

Chapter 7. The Potential of Econophysics for the Study of Economic Processes

7.1 Introduction

7.2 What is the Adequate Meaning for Contemporary Econophysics?

7.3 A Brief Historical Background of Econophysics

7.4 Methods of Econophysics

7.5 Review of Major Results and New Domains

7.6 Conclusions

References

Part III: Sociophysics

Chapter 8. A Physical Model to Connect Some Major Parameters to be Considered in the Bologna Reform

8.1 Introduction

8.2 The Physical Model

8.3 Conclusions

Reference

Chapter 9. Statistical Physics Models for Group Decision Making

9.1 Introduction

9.2 The Random Cluster Model for Group Decision Making (Galam, 2000b)

9.3 The Cluster Formation in the Social Impact Model (Kacperski and Holyst, 2000)

9.4 From Clusters of Individuals to Clusters of Countries (Gligor and Ausloos, 2007)

9.5 Conclusions

References

Chapter 10. Sociophysics: A New Science or a New Domain for Physicists in a Modern University

10.1 Introduction

10.2 A Brief History of Sociophysics

10.3 Definitional Issues of Sociophysics

10.4 Contemporary and Future Trends and Activities

10.6 Conclusions

10.7 A Final Remark

References