Last updated

Thermoeconomics, also referred to as biophysical economics, is a school of heterodox economics that applies the laws of statistical mechanics to economic theory. [1] Thermoeconomics can be thought of as the statistical physics of economic value [2] and is a subfield of econophysics.



Thermoeconomists maintain that human economic systems can be modeled as thermodynamic systems. Thermoeconomists argue that economic systems always involve matter, energy, entropy, and information. [3] Then, based on this premise, theoretical economic analogs of the first and second laws of thermodynamics are developed. [4]

Moreover, many economic activities result in the formation of structures. Thermoeconomics applies the statistical mechanics of non-equilibrium thermodynamics to model these activities. [1] In thermodynamic terminology, human economic activity may be described as a dissipative system, which flourishes by consuming free energy in transformations and exchange of resources, goods, and services. [5] [6]

Application to biology

Thermoeconomics is based on the proposition that the role of energy in biological evolution should be defined and understood not through the second law of thermodynamics but in terms of such economic criteria as productivity, efficiency, and especially the costs and benefits (or profitability) of the various mechanisms for capturing and utilizing available energy to build biomass and do work. [7] [8] [ dubious ]

See also

Related Research Articles

Entropy Property of a thermodynamic system

In statistical mechanics, entropy is an extensive property of a thermodynamic system. It quantifies the number Ω of microscopic configurations that are consistent with the macroscopic quantities that characterize the system. Under the assumption that each microstate is equally probable, the entropy is the natural logarithm of the number of microstates, multiplied by the Boltzmann constant kB. Formally,

Statistical mechanics, one of the pillars of modern physics, describes how macroscopic observations are related to microscopic parameters that fluctuate around an average. It connects thermodynamic quantities to microscopic behavior, whereas, in classical thermodynamics, the only available option would be to measure and tabulate such quantities for various materials.

Thermodynamics Physics of heat, work, and temperature

Thermodynamics is a branch of physics that deals with heat, work, and temperature, and their relation to energy, radiation, and physical properties of matter. The behavior of these quantities is governed by the four laws of thermodynamics which convey a quantitative description using measurable macroscopic physical quantities, but may be explained in terms of microscopic constituents by statistical mechanics. Thermodynamics applies to a wide variety of topics in science and engineering, especially physical chemistry, chemical engineering and mechanical engineering, but also in other complex fields such as meteorology.

Ecological economics

Ecological economics, bioeconomics, ecolonomy, or eco-economics, is both a transdisciplinary and an interdisciplinary field of academic research addressing the interdependence and coevolution of human economies and natural ecosystems, both intertemporally and spatially. By treating the economy as a subsystem of Earth's larger ecosystem, and by emphasizing the preservation of natural capital, the field of ecological economics is differentiated from environmental economics, which is the mainstream economic analysis of the environment. One survey of German economists found that ecological and environmental economics are different schools of economic thought, with ecological economists emphasizing strong sustainability and rejecting the proposition that physical (human-made) capital can substitute for natural capital.

Non-equilibrium thermodynamics Branch of thermodynamics

Non-equilibrium thermodynamics is a branch of thermodynamics that deals with physical systems that are not in thermodynamic equilibrium but can be described in terms of variables that represent an extrapolation of the variables used to specify the system in thermodynamic equilibrium. Non-equilibrium thermodynamics is concerned with transport processes and with the rates of chemical reactions. It relies on what may be thought of as more or less nearness to thermodynamic equilibrium.

Irreversible process

In science, a process that is not reversible is called irreversible. This concept arises frequently in thermodynamics.

Econophysics is a heterodox interdisciplinary research field, applying theories and methods originally developed by physicists in order to solve problems in economics, usually those including uncertainty or stochastic processes and nonlinear dynamics. Some of its application to the study of financial markets has also been termed statistical finance referring to its roots in statistical physics. Econophysics is closely related to social physics.

In physics and philosophy, a relational theory is a framework to understand reality or a physical system in such a way that the positions and other properties of objects are only meaningful relative to other objects. In a relational spacetime theory, space does not exist unless there are objects in it; nor does time exist without events. The relational view proposes that space is contained in objects and that an object represents within itself relationships to other objects. Space can be defined through the relations among the objects that it contains considering their variations through time. The alternative spatial theory is an absolute theory in which the space exists independently of any objects that can be immersed in it.

Laws of thermodynamics Axiomatic basis of thermodynamics

The four fundamental laws of thermodynamics express empirical facts and define physical quantities, such as temperature, heat, thermodynamic work, and entropy, that characterize thermodynamic processes and thermodynamic systems in thermodynamic equilibrium. They describe the relationships between these quantities, and form a basis for precluding the possibility of certain phenomena, such as perpetual motion. In addition to their use in thermodynamics, the laws have interdisciplinary applications in physics and chemistry.

Energetics is the study of energy under transformation. Because energy flows at all scales, from the quantum level to the biosphere and cosmos, energetics is a very broad discipline, encompassing for example thermodynamics, chemistry, biological energetics, biochemistry and ecological energetics. Where each branch of energetics begins and ends is a topic of constant debate. For example, Lehninger contended that when the science of thermodynamics deals with energy exchanges of all types, it can be called energetics.

Robert Ayres (scientist)

Robert Underwood Ayres is an American-born physicist and economist. His career has focused on the application of physical ideas, especially the laws of thermodynamics, to economics; a long-standing pioneering interest in material flows and transformations —a concept which he originated. His most recent work challenges the widely held economic theory of growth.

Thermal physics

Thermal physics is the combined study of thermodynamics, statistical mechanics, and kinetic theory of gases. This umbrella-subject is typically designed for physics students and functions to provide a general introduction to each of three core heat-related subjects. Other authors, however, define thermal physics loosely as a summation of only thermodynamics and statistical mechanics.

Nicholas Georgescu-Roegen

Nicholas Georgescu-Roegen was a Romanian mathematician, statistician and economist. He is best known today for his 1971 magnum opus The Entropy Law and the Economic Process, in which he argued that all natural resources are irreversibly degraded when put to use in economic activity. A progenitor and a paradigm founder in economics, Georgescu-Roegen's work was seminal in establishing ecological economics as an independent academic sub-discipline in economics.

Introduction to thermodynamic entropy

Entropy is an important concept in the branch of physics known as thermodynamics. It is a variable that describes the state of a system made of smaller components. Entropy is often used to describe a volume of matter composed of many molecules, but it can also be applied to a digital message composed of bits, or even the cattle on a ranch or a room full of people.

Charles A. S. Hall is an American systems ecologist and ESF Foundation Distinguished Professor at State University of New York in the College of Environmental Science & Forestry.

Temperature Physical quantity that expresses hot and cold

Temperature is a physical quantity that expresses hot and cold. It is the manifestation of thermal energy, present in all matter, which is the source of the occurrence of heat, a flow of energy, when a body is in contact with another that is colder.

Branches of physics

Physics deals with the combination of matter and energy. It also deals with a wide variety of systems, about which theories have been developed that are used by physicists. In general, theories are experimentally tested numerous times before they are accepted as correct as a description of Nature. For instance, the theory of classical mechanics accurately describes the motion of objects, provided they are much larger than atoms and moving at much less than the speed of light. These "central theories" are important tools for research in more specialized topics, and any physicist, regardless of his or her specialization, is expected to be literate in them.

Kinetic exchange models are multi-agent dynamic models inspired by the statistical physics of energy distribution, which try to explain the robust and universal features of income/wealth distributions.

Mauro Bonaiuti, PhD, teaches Ecological economics on the Master's on Socio-Environmental Sustainability and Ethical Finance programme at the University of Turin. He is co-founder of the Italian Degrowth Association and among the promoters of the Italian Solidarity Economy Network.


  1. 1 2 Sieniutycz, Stanislaw; Salamon, Peter (1990). Finite-Time Thermodynamics and Thermoeconomics. Taylor & Francis. ISBN   0-8448-1668-X.
  2. Chen, Jing (2005). The Physical Foundation of Economics - an Analytical Thermodynamic Theory. World Scientific. ISBN   981-256-323-7.
  3. Baumgarter, Stefan. (2004). Thermodynamic Models, Modeling in Ecological Economics (Ch. 18) Archived 2009-03-25 at the Wayback Machine
  4. Burley, Peter; Foster, John (1994). Economics and Thermodynamics – New Perspectives on Economic Analysis. Kluwer Academic Publishers. ISBN   0-7923-9446-1.
  5. Raine, Alan; Foster, John; Potts, Jason (2006). "The new entropy law and the economic process". Ecological Complexity. 3 (4): 354–360. doi:10.1016/j.ecocom.2007.02.009.
  6. Annila, A. and Salthe, S., Arto; Salthe, Stanley (2009). "Economies evolve by energy dispersal". Entropy. 11 (4): 606–633. Bibcode:2009Entrp..11..606A. doi: 10.3390/e11040606 .CS1 maint: multiple names: authors list (link)
  7. Peter A. Corning 1*, Stephen J. Kline. (2000). Thermodynamics, information and life revisited, Part II: Thermoeconomics and Control information Systems Research and Behavioral Science, Apr. 07, Volume 15, Issue 6 , Pages 453 – 482
  8. Corning, P. (2002). “Thermoeconomics – Beyond the Second Law Archived 2008-09-22 at the Wayback Machine

Further reading