# Rethinking Economic Measurement Using Statistical Ensembles

## TL;DR

This paper introduces statistical economics, using quantum game theory to resolve economic paradoxes and model income distributions with high accuracy.

## Contribution

The novel use of statistical ensembles from quantum game theory to reformulate economic measurement and analysis.

## Key findings

- The Allais paradox disappears when using statistical ensembles for choice under uncertainty.
- A model using income distribution and exergy input accurately predicts economic behavior over 24 years.
- Equality of outcome is modeled as a Bose–Einstein condensate, leading to a collapse in economic activity.

## Abstract

The axiomatic framework of quantum game theory gives us a new platform for exploring economics by resolving the foundational problems that have long plagued the expected utility hypothesis. This platform gives us a previously unrecognized tool in economics, the statistical ensemble, which we apply across three distinct economic spheres. We examine choice under uncertainty and find that the Allais paradox disappears. For over seventy years, this paradox has acted as a barrier to investigating human choice by masking actual choice heuristics. We discover a powerful connection between the canonical ensemble and neoclassical economics and demonstrate this connection’s predictive capability by examining income distributions in the United States over 24 years. This model is an astonishingly accurate predictor of economic behavior, using just the income distribution and the total exergy input into the economy. Finally, we examine the ideas of equality of outcome versus equality of opportunity. We show how to formally consider equality of outcome as a Bose–Einstein condensate and how its achievement leads to a corresponding collapse in economic activity. We call this new platform ‘statistical economics’ due to its reliance on statistical ensembles.