Entropy and Assimillative Capacity and a Revised Theory

22 Pages Posted: 23 Nov 2012 Last revised: 9 Apr 2014

See all articles by Dodo Jesuthason Thampapillai

Dodo Jesuthason Thampapillai

National University of Singapore (NUS) - Lee Kuan Yew School of Public Policy

Date Written: November 23, 2012

Abstract

The recognition of two important concepts in science, namely the assimilative capacity of nature and the entropy of law of thermodynamics enables the formulation of an alternative framework for factor-utilization in economics. This framework, which includes environmental capital (KN) as a factor, enables the illustration of the entropy law being the driver of diminishing marginal returns and the limited ranges of substitutability between factors. The paper also illustrates the estimation of KN utilization as point-estimates for Australia. These estimates when compared with the rates of economic growth suggest the presence of entropy.

Keywords: Entropy, Assimilative Capacity, Factor Utilization, Diminishing Marginal Returns

JEL Classification: Q56, Q57

Suggested Citation

Thampapillai, Dodo Jesuthason, Entropy and Assimillative Capacity and a Revised Theory (November 23, 2012). Lee Kuan Yew School of Public Policy Research Paper No. 12-17. Available at SSRN: https://ssrn.com/abstract=2179706 or http://dx.doi.org/10.2139/ssrn.2179706

Dodo Jesuthason Thampapillai (Contact Author)

National University of Singapore (NUS) - Lee Kuan Yew School of Public Policy ( email )

Singapore 117591
Singapore
+6565164844 (Phone)

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