by Suparna Samavedham
Photography courtesy of Ashley Griffin
H. Eugene Stanley began his journey into social science attempting to find an intersection of statistical physics and economics. 25 years later, Stanley is known to the world as the founding father of the new interdisciplinary field of Econophysics.
Econophysics is the term used to describe the activity of physicists when trying to understand the empirical facts of economics, such as the stock market, how firms grow and shrink, and so on.
Stanley recalled the story of how everything began.
“In all sciences, especially in physics, the big challenge is to a find a problem that is fascinating but has not already been solved. This goal can be very challenging for students,” Stanley said. “I have a lot of graduate students and they all need interesting and important problems to work on. Two of them suggested economics, even though they and I knew less than the average lay person.”
Stanley and his students focused on analyzing sets of data to uncover patterns and explain phenomenon, and they’ve experienced great developments, Stanley said.
“Nonetheless, 25 years ago we started looking for questions we might answer by focusing on data and asking the question, ‘What, if anything, are these data telling us?’” Stanley said. “We made big progress, and published our first papers in competitive journals such as ‘Nature.’”
Since then, Stanley has authored a textbook, received eleven doctorates Honoris Causa and numerous accolades. What was once a project of two people now attracts hundreds of researchers.
“I may or may not be the leader, but I am the founder, and that’s my style—I like to be the first to do something, and in science, being first is very important,” Stanley said.
Stanley also works in other fields, including medicine and biology. However, physicists—like other professionals—are free to do whatever they become interested in, and when Stanley’s graduate students brought the topic of economics to him, he became excited at the prospect of a new challenge.
“Fortunately, when a physicist looks at economics through the eyeglasses of a physicist, he or she sees things that economists might not have considered worthy of investigation” Stanley said. “Because we get easily excited by things we do not understand, we are sometimes able to contribute.”
And what are the efforts being made to build the bridge between this newfound econophysics field and traditional economics, a social science with a rich history?
“Economists are very well trained in mathematics. But we are attracted to study data and we ask a key question, ‘Are the data telling us something and, if so, what?’ So, totally different goals and that is one reason why economists are sometimes impatient with us,” Stanley said. “We care, but don’t have the patience to work and get a math theory. They have that patience. But what we do is analyze ‘big data.’”
The methods of econophysics and economics differ in their order of operations, Stanley said.
“And we differ from economists, who love a good theory, while we salivate over data,” Stanley said. “One leading economist told me ‘You econophysics are cheaters: you look at the data first and after you try to explain.’”
“Discovering the success of our new laws for the economies of other countries was the biggest thrill for me—I would receive emails from diverse corners of the globe saying, ‘We found the same thing in India,” Stanley said.
Physics is a vast field that is continuing to expand in its scale of interdisciplinary fields. What once started as classical mechanics and electromagnetism has strengthened rapidly to include biophysics, geophysics and psychophysics.
“What I like about physics is that you don’t have to memorize a lot,” Stanley said. “And asking the right question can be the key to success.”