arXiv subjects
Publications and source records attributed to Edward W. Piotrowski.
Kelly criterion, that maximizes the expectation value of the logarithm of wealth for bookmaker bets, gives an advantage over different class of strategies. We use projective symmetries for a explanation of this fact. Kelly's approach allows for an interesting financial interpretation of the Boltzmann/Shannon entropy. A "no-go" hypothesis for big investors is suggested.
In this work we propose a option pricing model based on the Ornstein-Uhlenbeck process. It is a new look at the Black-Scholes formula which is based on the quantum game theory. We show the differences between a classical look which is price changing by a Wiener process and the pricing is supported by a quantum model.
We study a quantum version of the sequential game illustrating problems connected with making rational decisions. We compare the results that the two models (quantum and classical) yield. In the quantum model intransitivity gains importance significantly. We argue that the quantum model describes our spontaneously shown preferences more precisely than the classical model, as these preferences are often intransitive.
Attention to the very physical aspects of information characterizes the current research in quantum computation, quantum cryptography and quantum communication. In most of the cases quantum description of the system provides advantages over the classical approach. Game theory, the study of decision making in conflict situation has already been extended to the quantum domain. We would like to review the latest development in quantum game theory that is relevant to information processing. We will begin by illustrating the general idea of a quantum game and methods of gaining an advantage over "classical opponent". Then we review the most important game theoretical aspects of quantum information processing. On grounds of the discussed material, we reason about possible future development of quantum game theory and its impact on information processing and the emerging information society. The idea of quantum artificial intelligence is explained.
We reason about possible future development of quantum game theory and its impact on information processing and the emerging information society. Two of the authors have recently proposed a quantum description of financial market in terms of quantum game theory. These "new games" cannot by themselves create extraordinary profits or multiplication of goods, but they may cause the dynamism of transaction which would result in more effective markets and capital flow into hands of the most efficient traders. We focus upon the problem of universality of measurement in quantum market games. Quantum-like approach to market description proves to be an important theoretical tool for investigation of computability problems in economics or game theory even if never implemented in real markets.
We study a simple example of a sequential game illustrating problems connected with making rational decisions that are universal for social sciences. The set of chooser's optimal decisions that manifest his preferences in case of a constant strategy of the adversary (the offering player), is investigated. It turns out that the order imposed by the player's rational preferences can be intransitive. The presented quantitative results imply a revision of the "common sense" opinions stating that preferences showing intransitivity are paradoxical and undesired.
On grounds of the discussed material, we reason about possible future development of quantum game theory and its impact on information processing and the emerging information society. The idea of quantum artificial intelligence is explained.
We discuss some aspects of Astumian suggestions that combination of biased games (Parrondo's paradox) can explain performance of molecular motors. Unfortunately the model is flawed by explicit asymmetry overlooked by the author. In addition, we show that taking into consideration stakes allows to remove the paradoxical behaviour of Parrondo games.
This is a short review of the background and recent development in quantum game theory and its possible application in economics and finance. The intersection of science and society is also discussed. The review is addressed to non--specialists.
Recent development in quantum computation and quantum information theory allows to extend the scope of game theory for the quantum world. The authors have recently proposed a quantum description of financial market in terms of quantum game theory. The paper contain an analysis of such markets that shows that there would be advantage in using quantum computers and quantum strategies.
A simple but nontrivial class of the quantum strategies in buying-selling games is presented. The player moves are a rational buying and an unconditional selling. The possibility of gaining extremal profits in such the games is considered. The entangled merchants hypothesis is proposed.