Speaker: Lee Smolin
Title: Symmetries in Economic Models and their Consequences
Date: Wednesday, March 18, 2009
Professor Lee Smolin of the Perimeter Institute for Theoretical Physics examines the fundamental Arrow-Debreu model of market equilibrium in neoclassical economics. He asks the basic question always raised by physicists when confronting a new system: What are the system’s symmetries? Addressing this question, he argues that many markets have multiple equilibria. He also explores the application of the principle of gauge invariance to markets—an idea originally introduced by Malaney and Weinstein—and explains some of this principle’s consequences for economic theory.