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Entropy, physical information and economic values

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We show that the second law of thermodynamics for a general non-equilibrium system can be expressed as a relationship between physical information change overtime, entropy production and physical information fluxes. It follows that a steady state system far from thermodynamic equilibrium must embody some structural information. It must import physical information from external sources of free energy or structure to compensate for internal entropy generation due to the loss of information from the dissolution of existing structures. Nevertheless, the Second Law is also consistent with an accumulation of physical information in the form of increasingly complex ordered structures. We display a corresponding but contrasting axiom for evolutionary biological and economic systems. This sheds light on the role of purposive decision-making behavior and/or human preferences as a determinant of the direction of evolutionary change. It also sheds light on the role of selection in biological evolution

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en

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application/pdf

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http://flora.insead.edu/fichiersti_wp/Inseadwp1994/94-05.pdf

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Copyright INSEAD. All rights reserved