Describing Crises with a Critical Exponent of the Reggeon Field Theory
11 Pages Posted: 12 Jul 2016 Last revised: 17 Sep 2016
Date Written: July 11, 2016
We present evidence that markets in crisis can be described by a critical exponent of the nonlinear-diffusion Reggeon Field Theory, calculated 40 years ago, with no free parameters, translated to finance. We propose this as a benchmark for average crisis behavior, to which individual crises can be rich or cheap. In another paper we present a quantitative model for the probability of equity crises in advance. An earlier paper contained a summary.
Keywords: markets in crisis, critical exponent, nonlinear-diffusion, Reggeon Field Theory, no free parameters, benchmark, rich or cheap
JEL Classification: E44, G01
Suggested Citation: Suggested Citation