用物理方法分析經濟學：快速增加財富的方法（國際英文版第二版）: Analysis of Economics with Physics: Ways to Increase Wealth Rapidly

By Shui Yin Lo

Economics is regarded as a branch of applied physics.* Wealth is defined exact quantitatively as wealth ring. Wealth ring consists of production sector, exchange sector, consumption sector, and environmental sector. This is a logical expansion of traditional economics of supply and demand . Money is defined as a universal exchange

• Language: English
• Publisher: EHGBooks
• Release date: Aug 1, 2021
• ISBN: 9781647843557

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Table of Contents

Table of Contents

Preface

Chapter 1: Definition of wealth as wealth ring

1.1 Definition of wealth by others

1.2 Exact definition of wealth W is wealth ring W (p, e, c, o)

1.3 Money, the universal exchanger

1.4 An example of annual production of wealth and devaluation

Chapter 2: Agricultural society, and First, Second, and Third Industrial revolution

2.1 Simple views of Agricultural society, First, Second, and Third Industrial revolution.

2.2 Quantum frameworks: QF1, QF2, QF3, QF4,QF5, QF6, QF7.

2.3 Picture of the wealth ring

Chapter 3: The Production Sector W (p)

3.1 Agricultural society, First, Second and Third Industrial revolution

3.2 The production sector W(p)

QF1: Uncertainty

QF2: Quantum Duality

QF3: Three ways to influence production

QF4: Four macroscopic human variables p, q, r, s:

QF5: Five fundamental variables (n, t, x, E, j).

QF6 symmetries

QF7: Action S

3.3 Production chain and competition

3.4 A production model that drastically increases production.

3.5 Coherent production model:

3.5 Production model for unemployment and its solution:

3.7 Classification of industry according to products in the production sector N(p)

Chapter 4: The Exchange sector W (e)

4.1. Quantum Framework :

QF1: Uncertainty

QF2: Quantum duality (contradiction)

QF3: boundary, bound, exchanges

QF4: Four types of human variables

QF5 : Five fundamental variables, numbers n, time t, space x, energy E, and flow

QF6: Symmetries, conservation laws, invariance

QF7: Action S

4.2 Markets: farm markets, Department stores , supermarket, stock markets, money markets, internet,

4.3 Production-exchange Model: picture to illustrate

Chapter 5: The consumption sector W ( c ).

5.1 Quantum Framework of the consumption sector W (c )

QF1: Uncertainty

QF2: Quantum Duality (contradiction)

QF3: Three ways to influence consumption: boundary, binding, and exchanges

QF4: Four types of human variables

QF5: Five fundamental variables, numbers (N), time (t) , space(x) , energy(E), and flow(j)

QF6: Six symmetries, conservation laws

QF7: Action S

5.2 Eight major types of consumption:

5.3 Service industry as part of consumer chain. picture of consumer chain

5.4: Competition among consumers and exchangers Fig(5.2) and Fig (5.3) , a Pictorial presentation

5.5 : The environmental sector of the wealth ring W(o) :

5.6 Model for competition in Production, exchange and consumption sectors

5.7 Classification of industries according to wealth creation and its relations with International Standard Industrial Classification

Chapter 6: Fundamental law of increase of wealth.

6.1 Agricultural reform:

6.2 Increase exchange N(e)

Chapter 7: The rapid rise of wealth of China in thirty years from 1980 to 2010

7.1 The thirty years from 1949 to 1979 :

7.2 300 years into 30 years

7.3. The rapid rise of wealth in all three sectors: production sector, exchange sector, and consumption sector .

7.4 Infrastructure:

7.5 Superstructure

7.5 Superstructures – party and government

7.6 Cluster Model of exchangers:

7.7 Model of Road and rapid increase of wealth:

7.8 Model of free trade, tax and increase of wealth

7.9 The role of peasants in the rapid increase of wealth

7.10 The role of Special Economic Zone

7.11 Other people’s reasons behind the rapid increase of wealth in China in 30 years

7.12 Time line for  the era of Economic Reform and open door

Chapter 8 Quantum Framework for the economy of current world

8.1 Quantum Framework 1,2,3,4,5,6,7 from quantum physics

8.2 The Environmental sector W(o) and an Ecological  State

8.3 Gold mountain Model

8.4 Ecological City Model:

8.5 Fourth Industrial Revolution

Chapter 9 Quantum Economic- a Summary

9.1 Two precise concepts  and one fundamental theorem

9.2 Sufficient variables are invented to describe major economic activities

9.3 Ten simple models are invented.

9.4 Inclusive framework

9.5 The future of human society is an ecological society.

Appendix

Preface

Quantum physics is capable of describing, explaining and predicting the behavior of the very large object like the universe after the big bang.

Quantum physics is capable of describing, explaining and predicting the behavior of the very small objects like quarks, electrons, and protons.

Quantum physics is also capable of describing, explaining and predicting the behavior of objects in meter size such as human being.

Quantum physics is therefore capable of describing, explaining and predicting  the economic behavior of human beings. 

Economic is treated as a branch of applied physics in this book.

Quantum physics is built on seven quantum frameworks: Quantum Framework QF 1, Quantum Framework QF 2, Quantum Framework QF 3, Quantum Framework QF 4, Quantum Framework QF 5, Quantum Framework QF 6, and Quantum Framework QF7. It can be remembered simply as 1, 2, 3, 4, 5, 6, 7.

The economy of a society must have four sectors: the production sector, the exchange sector, the consumption sector, and the environmental sector to be a sustainable society.

A society that wants to increase its wealth rapidly must raise its production level, exchange level, and the consumption level simultaneously. This is valid from agriculture to first industrial revolution, from first industrial revolution to second industrial revolution, and from second industrial revolution to third industrial revolution.

Chapter 1: Definition of wealth as wealth ring

In Physics the first task to study any subject is to have exact quantitative definitions of the basic concepts.

In economics, one of the most important concepts is wealth. What is wealth? What is the exact quantitative definition of wealth?

Before we give our definition similar to the way we do in physics, let us see how others define wealth first:

1.1 Definition of wealth by others

1.1.1     Adam Smith in his seminal work The Wealth of Nations, described wealth as the annual produce of the land and labor of the society. This produce is, at its simplest, that which satisfies human needs and wants of utility.

Criticism: wealth is not defined quantitatively

1.1.2 The United Nations definition of inclusive wealth is a monetary measure which includes the sum of natural, human, and physical assets. Natural capital includes land, forests, energy resources, and minerals. Human capital is the population's education and skills. Physical (or manufactured) capital includes such things as machinery, buildings, and infrastructure.

Criticism: The definition is quantitative. But forests, energy resources, and human capital have subjective element. The evaluation depends on the evaluator’s knowledge and bias.

1.1.3     Wikipedia defines wealth as Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions

Criticism: It stated the importance of conversion, but did not specify what form. Different conversion may result in different evaluation of wealth.

1.1.4 Jim Chappelow of Investopedia define wealth as Wealth measures the value of all the assets of worth owned by a person, community, company, or country. Wealth is determined by taking the total market value of all physical and intangible assets owned, then subtracting all debts. Essentially, wealth is the accumulation of scarce resources. Specific people, organizations, and nations are said to be wealthy when they are able to accumulate many valuable resources or goods. Wealth can be contrasted to income in that wealth is a stock and income is a flow, and it can be seen in either absolute or relative terms.

Criticism: The value of assets has to be  subtracted with debts. Same amount of assets will be worth different with different debts. We like to have the valuation of assets independent of debt. We want a definition in economic like a definition in physics. In physics, definition of mass of an object is  independent of the measurement, and does not change.

1.1.5    GDP as wealth.

Gross domestic product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period. As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country’s economic wealth. GDP is better than normal use of wealth to represent the wealth of nation , because it is time dependent, and quantitative. It is objective because various people and various institution give the same answer.

GDP viewed from  our definition of wealth ring emphasizes the productive sector. However, it is different from PPP, which is the definition of wealth in the consumption sector. It is necessary to have a definition of wealth which is the same in the production sector, exchange sector, and the consumption sector.

Furthermore, the unit of GDP is currently US dollar. However intrinsically it could be the unit of currency of any country. China often quote its GDP in ¥ RMP , and in World Bank China’s  GDP is in US dollars。The GDP changes when  the exchange rate between RMP and US dollar changes. The exact definition of wealth should not depend on unit.

1.1.6    PPP as wealth

Purchase Power parity (PPP) is defined by Wikipedia as a measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries' currencies.

In many cases, PPP produces an inflation rate that is equal to the price of the basket of goods at one location divided by the price of the basket of goods at a different location. The PPP inflation and exchange rate may differ from the market exchange rate because of poverty, tariffs, and other transaction costs. PPP exchange rates are widely used when comparing the GDP of different countries. PPP is only valid in consumption sector, and not valid in production sector.

1.2 Exact definition of wealth W is wealth ring W (p, e, c, o)

The exact definition of wealth is wealth ring. The wealth ring W(p,e,c,o) consists of four sectors: the production sector p, the exchange sector e, the consumption sector c, and the environment sector o.

The o stands for the spherical earth.

The previous definitions of wealth in section 1.1 given by different people, and different organization have some part of wealth right. But the comprehensive definition of wealth as wealth ring  above is a comprehensive one because it contains the correct elements of all the definitions in section 1.1

According to quantum physics, there are five fundamental variables that are needed to describe any object in our universe:  number n, time t, space x, energy E , and flow j. The most important variable is n.

There are three kinds of number n = (N, b, d).  N is the number of objects under consideration. For us the number N has two components: the number of people H,  and the number of goods N(goods) . They are two most important numbers. The number of goods N(goods) in the four sectors of the Wealth ring is conserved. For simplicity we shall use the same N to mean N (goods), when there is no confusion. It can be regarded as the unit of wealth. The more goods a group of people can produce, the more wealth the group has.

Since the number of goods produced N(goods) in the Production sector W(p) do not change when the goods are exchanged  in the exchange sector W( e ), or when the goods are consumed in the consumption sector W( o) , or when the goods enter the environmental sector W(o). So, the number of goods belong the wealth ring W(peco). When N (goods) is produced in US and  evaluated in US $ in US, then it becomes part of the GDP in US $. When N ( goods ) is produced in China, and evaluated in RMB, then it becomes part of the GDP of China in RMB.

The second important number is the number of bits b, which is the unit of information. There are three parts of b. The first part b¹ is the knowledge of producing goods. It is the part that contains intellectual properties and the patents. Without knowledge, we cannot produce. The second part of b² is the order of the goods. The good is created from a number of parts. The parts are not in order. Order is created from disorder, which can be done by the addition of energy. Without additional energy, the second law