* The scientific consortium of the project (since 2014)
* The paper, including text+table+figure (NOV, 13)
* The appendices, including five appendices (NOV, 13)
* The excel file, with all the coputations about all world nations (updated since March, 12)
* An older version of this paper appears on the arXiv, http://arxiv.org/abs/1112.0262
This paper [1] suggests a new model in characterizing modern societies
and its economical and political realities. The type of the model
introduced here is a very simple one in stochastic processes since the
model involves just 3 degrees of freedom. Yet, from the sociological and
economical viewpoints, this model was not used in past in describing
modern societies. We think that this model describes reality much more
accurately than other economical and sociological models, and hence the
uniqueness and importance of this work. In fact, the reality of the past
7 years broke most of the basic assumptions and models in economy and
sociology, suggesting that a new model is needed. Utilizing the model,
the conclusion is clear: solving the high unemployment and the debt
problems in many of western societies is possible when redistributing
the wealth: shifting wealth & influence on the flow of wealth from
the 1% in the direction of the 99%. The possible policies include:
breaking the-adjusted-monopolies, fighting not-just-biases in the flow
of wealth, making the economy free rather than 1%-controlled, special
taxation of the top 1%, etc. Namely, it is NOT austerity versus spending
that is important, yet, the influence of any new regulation on the
wealth distribution.
About the society-deciders model.-
The model is composed of a system of deciders and a bulk of people. The
bulk is characterized with a temperature T that equals the total opinion
of the deciders plus a Brownian stochastic motion with strength c. T
determines the rates in the model for the dynamics of the deciders
through the variable T/T_twd, where T_twd is a coefficient termed the
temperature of stability. This forms a cycle of relations among the
society and the deciders. This relations are
similar with the Lotka – Volterra model in ecology (the prey predator
model), yet,
the society-deciders model is much richer and general.
The main important three contributions here are:
(1) A new way of describing the society in our times is suggested. This model and its variations should form the basis for many studies in socio-econo-physics. We show that this model is stable mathematically, in the sense that it is general such that many of its variants will have similar behaviors. The specific sociological and economical considerations are contained in c and T_twd, where we build a simple mathematical expressions that express these coefficients in terms of known and derived indices in economics (Gini index, the relative wealth of the top one percent in society, GDP, debt, unemployment, IMF’s shares, etc.) and political sciences (the freedom index, the democracy index, frequency and strength of protests, etc.). This model can define fairness in society mathematically, based in the values of the computed coefficients.
(2) This model explains why the crisis in Europe and USA is NOT solved: the democratic systems are not fair. In the current situation, the deciders are not exposed to the economic stress of the people. We compute the fairness index in various nations showing how far from fair these nations are.
(3)
This model suggests ways for solving the economical and sociological crises.
Among the important issues are: increasing freedom and democracy,
decreasing the relative wealth of the top 0.1%, improving the wealth
distribution, decreasing the blind appreciation in fame and money,
stabilizing the political system, and stabilize interactions with
neighbor nations. Note that the issue of austerity versus spending is
not the important one relative with these issues. In the particular case
of in the USA, mass protests with regard of the economic stress can
trigger actions from the deciders in the direction specified.
[1] O. Flomenbom, The society-deciders model and fairness in nations, in press (2015).