## Friday, April 21, 2017

### Economics to physics phrasebook

Cameron Murray tweeted out his old post about economics terminology. Someone commented adding a sociology-economics dictionary. I thought I'd get in on the game with an "economics to physics" dictionary (the $^{*}$ means we're using the economics definition):

$$\begin{array} \text{Economics} & Physics \\ \text{commodity} & \text{matter} \\ \text{comparative advantage} & \text{coupling state spaces changes equilibrium}\\ \text{discount factor} & \text{smooth cutoff regulator} \\ \text{DSGE} & \text{arbitrary stochastic difference equation} \\ & \text{with constraints} \\ \text{demand} & \text{unobservable field that interacts with supply}^{*} \\ \text{endogenous} & \text{not an external field} \\ \text{equilibrium} & \text{solution to set of equations} \\ \text{general equilibrium} & \text{solution to all of the equations} \\ \text{partial equilibrium} & \text{solution to a few of the equations} \\ \text{estimate} & \text{fit parameters to data} \\ \text{Euler equation} & \text{equation of motion for constrained Lagrangian} \\ \text{exogenous} & \text{external field} \\ \text{expectations} & \text{toy model}^{*}\;\text{of the future} \\ E_{t} & \text{time translation operator} \\ \text{EMH} & \text{Brownian motion as an effective theory of prices} \\ & \text{(scale unclear)} \\ \text{inflation} & \text{rate of change of the price level}^{*} \\ \text{price level} & \text{arbitrary linear combination of prices} \\ & \text{(varies)} \\ \text{economics} & \text{theoretical economics} \\ \text{growth economics} & \text{theoretical economics} \\ & n \gg 1, t \gg 1 \;\text{quarter} \\ \text{macroeconomics} & \text{theoretical economics} \\ & n \gg 1, t \sim 1 \;\text{quarter} \\ \text{microeconomics} & \text{theoretical economics} \\ & n \sim 1, t \ll 1 \;\text{quarter} \\ \text{natural rate of interest} & \text{unobservable field} \\ \text{model} & \text{toy model} \\ \text{toy model} & \text{handwaving} \\ \text{theory} & \text{philosophy} \\ \infty & \text{sometimes inexplicably has units} \\ \text{growth} & \text{exponential growth} \\ \text{money} & \text{toy model}^{*}\;\text{of money} \\ \pi & \text{inflation}^{*} \; \text{, not}\; 3.14159...\\ \text{total factor productivity} & \text{phlogiston} \\ \text{rational expectations} & \text{causality violating toy model}^{*}\;\text{of the future} \\ \text{recession} & \text{toy model}^{*}\;\text{of a recession} \\ \text{supply} & \text{observable field} \\ \text{utility} & \text{unobservable field} \end{array}$$