Can concepts from statistical mechanics (Maxwell-Boltzmann distribution, etc) be applied to build macroeconomic models?

Economics Dec 15, 2020

Expert Solution

The statistical mechanics of Maxwell Boltzmann Distribution can be applied to the macroeconomics. It can be used to measure income inequality in the economy. the income distribution is compared to the distribution of energy among the particles where energy is money and particles are people. So, the statistical mechanics of Maxwell Boltzmann Distribution can be used to build macroeconomic models.

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