We present a simple mathematical formulation of an entropy theory of value, consistent with evolutionary economics. It is a non-equilibrium theory, logarithmic in form, which explains the roles of monopoly and oligopoly as well as scarcity in determining economic values. It is an objective theory, rooted in physical realities and economic institutions, similar to the information theory developed by Shannon (1948). We compare this theory to the subjective, utility theory of the Arrow–Debreu model, the foundation of general equilibrium economics.
An entropy theory of value with reflections on the Arrow–Debreu model
Article, Refereed Journal
Review of Evolutionary Political Economy