Entropy and Economic Modelling

Abstract

Entropy-maximizing models have been focused predominantly at the microscopic level of social and economic activities, their use being advocated by urban geographers, mathematicians, and microeconomists. By maintaining a sharp distinction between the behavioural and statistical aspects of entropy, various submodels may be formulated to generate the most probable pattern of individual choice behaviour. It may nevertheless be possible to regard each submodel of activity as an essential component of some larger, more complex macromodel of the entire economy. Various forms of (simultaneous or sequential) macromodels could then be investigated by examining alternative linkage arrangements between the behavioural submodels.