Use of Symmetries in Economics: An Overview

Abstract

In this paper, we show that many semi-heuristic econometric formulas can be derived from the natural symmetry requirements. The list of such formulas
includes many famous formulas provided by Nobelprize winners, such as Hurwicz optimism-pessimism criterion for decision making under uncertainty, McFadden’s formula for probabilistic decision making, Nash’s formula for bargaining solution -as well as Cobb-Douglas formula for production, gravity model for trade, etc.