Nav: Home

The physics that drives periodic economic downturns

March 24, 2020

DURHAM, N.C. -- A professor at Duke University says that the way spilled milk spreads across the floor can explain why economic downturns regularly occur.

In a paper published online on March 5 in the International Journal of Energy Research, Adrian Bejan, the J.A. Jones Distinguished Professor of Mechanical Engineering at Duke, posits that recessions emerge as a natural feature of physics, rooted in the time-dependent movement of spreading over an area.

"This theory sheds light on common questions such as whether or not history repeats itself or if the economy is stable or not," said Bejan. "These are questions that can find answers from physics. There exist universal mechanisms that give rise to laws governing the growth of economics. And the answer to sustaining that growth lies in innovation."

Bejan's conclusion combines the ideas behind two previous papers detailing the prevalence of S-curves in all corners of life and the direct link between economics and fuel consumption.

In 2011, Bejan predicted that the growth of innumerable spreading phenomena over time follows the shape of an "S curve" otherwise known as the sigmoid function, and that this phenomena is a result of the constructal law that he penned in 1996. For example, a bottle of milk spilled on the floor will have a small initial footprint, followed by a rapid finger-shaped expansion across the kitchen's tiles, followed by a final phase of slow creep. This same history of slow, fast, slow can be seen in chemical reactions, population growth, the adoption of new technology and even the spreading of new ideas.

Several years later, Bejan tied together economics and physics, showing that physics accounts for the proportionality between a nation's gross domestic product and its annual consumption of fuel. "Pushing requires power, and power requires fuel, whether it is food that powers the human body or gasoline that powers cars," said Bejan. "And the amount of fuel consumed by a nation is directly related to its economic growth. So really, physics and economics are two sides of the same coin."

In his new work, Bejan replaces the concepts of power with the concepts of economics including money, savings, time and bubbles. He shows that, given the ability to produce excess power and lend it to others as money, the flow of money being spent to push things around a given area looks exactly like the flow of power being used for the same purpose.

"The ability to save and lend, for money to flow between neighbors across the globe, is a chain reaction," said Bejan. "Thus economic development as a whole is a chain reaction, and the physics of that phenomenon is detailed in this paper."

Putting the two concepts together, Bejan shows that the "S" curve of the economic productivity of a commodity clashes with the linear curve of investment. At first, the S curve is below the line, and the investment is a speculative ray of hope. After time, the S curve moves above the investment line and generates prosperity and promise. But as the adoption or usefulness of that commodity, idea or invention wanes, the S curve reaches its plateau and it inevitably crosses back to the wrong side of the investment line.

This is when economic downturns strike. But while Bejan says this event is inevitable for anything and everything that is bought and sold, it doesn't mean that the entire economy has to take a nosedive.

"Everything that spreads has a finite life, and if you don't do something to postpone that precipice, then you will fall over the cliff," said Bejan. "But a market that is free is capable of generating new S curves on top of new S curves. So as long as people are being innovative and creative and bringing large enough new S curves to the picture, the general trend of economic growth can continue."
"Energy theory of periodic economic growth." Adrian Bejan, Marcelo R. Errera, Umit Gunes. Int J Energy Res. 2020; 1- 12. DOI: 10.1002/er.5267

Duke University

Related Physics Articles:

Helium, a little atom for big physics
Helium is the simplest multi-body atom. Its energy levels can be calculated with extremely high precision only relying on a few fundamental physical constants and the quantum electrodynamics (QED) theory.
Hyperbolic metamaterials exhibit 2T physics
According to Igor Smolyaninov of the University of Maryland, ''One of the more unusual applications of metamaterials was a theoretical proposal to construct a physical system that would exhibit two-time physics behavior on small scales.''
Challenges and opportunities for women in physics
Women in the United States hold fewer than 25% of bachelor's degrees, 20% of doctoral degrees and 19% of faculty positions in physics.
Indeterminist physics for an open world
Classical physics is characterized by the equations describing the world.
Leptons help in tracking new physics
Electrons with 'colleagues' -- other leptons - are one of many products of collisions observed in the LHCb experiment at the Large Hadron Collider.
Has physics ever been deterministic?
Researchers from the Austrian Academy of Sciences, the University of Vienna and the University of Geneva, have proposed a new interpretation of classical physics without real numbers.
Twisted physics
A new study in the journal Nature shows that superconductivity in bilayer graphene can be turned on or off with a small voltage change, increasing its usefulness for electronic devices.
Physics vs. asthma
A research team from the MIPT Center for Molecular Mechanisms of Aging and Age-Related Diseases has collaborated with colleagues from the U.S., Canada, France, and Germany to determine the spatial structure of the CysLT1 receptor.
2D topological physics from shaking a 1D wire
Published in Physical Review X, this new study propose a realistic scheme to observe a 'cold-atomic quantum Hall effect.'
Helping physics teachers who don't know physics
A shortage of high school physics teachers has led to teachers with little-to-no training taking over physics classrooms, reports show.
More Physics News and Physics Current Events

Trending Science News

Current Coronavirus (COVID-19) News

Top Science Podcasts

We have hand picked the top science podcasts of 2020.
Now Playing: TED Radio Hour

Listen Again: The Power Of Spaces
How do spaces shape the human experience? In what ways do our rooms, homes, and buildings give us meaning and purpose? This hour, TED speakers explore the power of the spaces we make and inhabit. Guests include architect Michael Murphy, musician David Byrne, artist Es Devlin, and architect Siamak Hariri.
Now Playing: Science for the People

#576 Science Communication in Creative Places
When you think of science communication, you might think of TED talks or museum talks or video talks, or... people giving lectures. It's a lot of people talking. But there's more to sci comm than that. This week host Bethany Brookshire talks to three people who have looked at science communication in places you might not expect it. We'll speak with Mauna Dasari, a graduate student at Notre Dame, about making mammals into a March Madness match. We'll talk with Sarah Garner, director of the Pathologists Assistant Program at Tulane University School of Medicine, who takes pathology instruction out of...
Now Playing: Radiolab

What If?
There's plenty of speculation about what Donald Trump might do in the wake of the election. Would he dispute the results if he loses? Would he simply refuse to leave office, or even try to use the military to maintain control? Last summer, Rosa Brooks got together a team of experts and political operatives from both sides of the aisle to ask a slightly different question. Rather than arguing about whether he'd do those things, they dug into what exactly would happen if he did. Part war game part choose your own adventure, Rosa's Transition Integrity Project doesn't give us any predictions, and it isn't a referendum on Trump. Instead, it's a deeply illuminating stress test on our laws, our institutions, and on the commitment to democracy written into the constitution. This episode was reported by Bethel Habte, with help from Tracie Hunte, and produced by Bethel Habte. Jeremy Bloom provided original music. Support Radiolab by becoming a member today at     You can read The Transition Integrity Project's report here.