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The ‘Drop of Honey Effect’. A Note on Chaos in Economics

The International Journal of Latest Trends in Finance and Economic Sciences

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Title The ‘Drop of Honey Effect’. A Note on Chaos in Economics
 
Creator Ferreira, Manuel Alberto M.; ISCTE-IUL
Filipe, José António; Department of Quantitative Methods
 
Description Relationships in non-linear systems are unstable. Considering that, chaos theory aims to understand and to explain the unpredictable aspects of nature, social life, uncertainties, nonlinearities, disorders and confusion. Small differences in initial conditions - such as those due to rounding errors in numerical computation – may perform diverging outcomes tracking to systems’ chaotic behaviour. In these circumstances, long-term predictions become impossible in general. A brilliant metaphor on this is the so-called butterfly effect, about the way how the “flapping of the wings of a butterfly” may cause huge phenomena either they are physical, atmospheric or social. In this work, the drop of honey effect metaphor is proposed for representing this kind of butterfly effect for chaos in social phenomena, in particular in economics and politics.
 
Publisher International Journal of Latest Trends in Finance and Economic Sciences
 
Contributor —
 
Date 2013-01-23
 
Type —
 
Format application/pdf
 
Identifier http://ojs.excelingtech.co.uk/index.php/IJLTFES/article/view/Ferreira
10.2047/ijltfesvol2iss4-350-353
 
Source International Journal of Latest Trends in Finance and Economic Sciences; Vol 2, No 4 (2012): December; 350-353
 
Language en
 
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