Re: zero average profit

From: clyder@GN.APC.ORG
Date: Thu Jun 12 2003 - 17:38:47 EDT

Quoting Ian Wright <ian_paul_wright@HOTMAIL.COM>:

>  .
> In the case of income distribution an individual has
> a finite lifespan and so I agree it is clear that their
> income will not time-average to the distribution mean.
> But I would like a satisfactory explanation of why the
> approach adopted in "statistical mechanics of money"
> generates a distribution in close agreement with reality
> (ignoring, for the moment, the lower and upper tails).
> I would need to look into it, but I would guess their
> model is ergodic. The answer may lie in a more flexible
> interpretation of the model. The particles in the model
> can be interpreted as referring to roles, rather than
> distinct individuals. Distinct individuals enter and
> leave the system by assuming a role in the economy. The
> roles do not change, and are "infinitely" lived, compared
> to the individuals that assume those roles. The income
> of any particular role will time-average to the
> distribution mean, even if in the interpretation an
> individual's income cannot. Does this make sense to you?
> It seems to me that the same argument can be applied to
> firms, capital etc.

I am not sure what the roles you are describing would be.
The social situation is not directly analogous to particles
in statistical mechanics since in classical theory the particles
are assumed to be conserved. However, it is clearly not
the case either with humans or abstract juridical persons.

However, it may be the case that there exists versions of
statistical mechanics that deal with non-conserved particles,
perhaps thermodynamic analysis of the quantum vacuum might
provide us with some ideas for this.

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