Authors: Gaurav Biraris
Comments: 25 Pages.
New approach to study economies is adopted in the paper. The change in prices is assumed solely by variation in demands or supplies. Cause of such variations is quantified. Efforts behind changes in demand, supply and prices are characterized as ‘potential’. The potential stems from different kind of resources and is utilized for trade or production; quantification of such utilization is done. We also have explored rules about flow of potential in economy. The laws can be used to study evolution of economies. A set of goods & services, population and initial prices can be considered as the economy for study. In addition to conventional parameters, we get a new state determining parameter for economy defined as ecomperature. Ecomperature mimics temperature from physics. Resources flow from sections of higher ecomperature to that of lower ecomperature to attain uniformity in ecomperatures. Some aspects of possible applications of the theory are discussed. The paper isn’t about interdisciplinary analogies or similarities, but it is about the foundative reasoning behind the scientific mechanisms.
Category: Economics and Finance