Chapter 18 - Extremal Principles and Limiting Possibilities of Open Thermodynamic and Economic Systems

Abstract

This chapter focuses on Prigogine's minimum-entropy principle, which is generalized to thermodynamic and micro-economic systems that include an active subsystem (heat engine or economic intermediary). New bounds on the limiting possibilities of an open system with an active sub-system are derived, including the bound on the productivity of the heat-driven separation. The economic analogies of Onsager's reciprocity conditions are also derived. Thermodynamic and micro-economic systems are both macro systems. They include a large number of micro sub-systems, which are not controllable and not observable. Control and observation in such systems is feasible on the macro level only. The state of the macro system is described by macro variables that depend on the averaged behavior of its components only. Macro variables are divided as extensive and intensive. The former include internal energy, entropy, mass in thermodynamics, and stocks of resources and capital in economics. Economic systems differ from thermodynamic systems in many respects including the voluntary, discretional nature of exchange, production in addition to exchange, competition in various forms. However, thermodynamic and economic systems are both macro systems that have many analogies among them, including analogy of irreversibility of processes in them.