Statistical equilibria in economic systems: Socio-combinatorial or individualist-reductionist characterizations?
Department of Economics, New School for Social Research, New York, NY, USA
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Received in final form: 18 November 2019
Published online: 7 July 2020
This paper motivates the distinctive analytical usefulness of socio-combinatorial characterizations of statistical equilibria in economic systems. It does so by drawing on Gibbs’ approach to thermodynamic ensembles and on Jaynes’ epistemic characterization of probabilities, entropy, and associated concepts. The resulting approach is contrasted with two classes of individualist-reductionist characterizations of statistical equilibria that are influential among economists and physicists: Micro-econometric cross-sectional and drift-diffusion models. Two illustrative applications contrast the insights each approach offers into the economic and social content of observed statistical equilibria, involving distributions of individual incomes and rates of return for individual enterprises.
© EDP Sciences, Springer-Verlag GmbH Germany, part of Springer Nature, 2020