Representing Markets Using The Boltzmann Distribution

Abstract

The applicability of using the Boltzmann distribution for modeling economic markets is reviewed. While remaining accessible to business students and professionals, this review provides a clear, yet rigorous account of using a Boltzmann-inspired statistical formulation of market behavior. The formulation's flexibility for modeling market behavior in two types of markets is shown and the distribution's use for practical analysis encouraged. Suggestions for future study are also given.