Economic interpretation of fractional derivatives

An economic interpretation of the Caputo derivatives of non-integer orders is proposed. The suggested economic interpretation of the fractional derivatives is based on a generalization of average and marginal values of economic indicators. We formulate an economic interpretation by using the concept...

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Bibliographic Details
Published in:arXiv.org 2017-12
Main Authors: Tarasova, Valentina V, Tarasov, Vasily E
Format: Article
Language:English
Subjects:
Derivatives
Economic models
Economics
Indicators
Online Access:Get full text
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Summary:An economic interpretation of the Caputo derivatives of non-integer orders is proposed. The suggested economic interpretation of the fractional derivatives is based on a generalization of average and marginal values of economic indicators. We formulate an economic interpretation by using the concept of the T-indicator that allows us to describe economic processes with memory. The standard average and marginal values of indicator are special cases of the proposed T-indicator, when the order is equal to zero and one, respectively. The fractional derivatives are interpreted as economic characteristics (indicators) that are intermediate between the standard average and marginal values of indicators.
ISSN:2331-8422
DOI:10.48550/arxiv.1712.09575