The relativistic dynamics of labor economics

An economic engineering treatment

Master thesis (2023)

Authors

J.M.L. de Graaf Mechanical Engineering

Contributors

M.B. Mendel Team Bart De Schutter - Mechanical, Maritime and Materials Engineering (supervisor 1)
C. Hutters Team Bart De Schutter - Mechanical, Maritime and Materials Engineering (supervisor 2)
G.J. Verbiest Dynamics of Micro and Nano Systems - Mechanical, Maritime and Materials Engineering (supervisor 2)
Faculty
Mechanical Engineering
Copyright: © 2023 Brigitte de Graaf
Projective geometry Economic Engineering Labor Economics Special theory of relativity Poincaré disk
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Published Date

04-12-2023

Language

English

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Faculty

Mechanical Engineering

Abstract

In this thesis, the analogy between the special theory of relativity and the dynamics of a laborer is developed in the context of labor economics. At the basis of this analogy stands an individual laborer who cannot supply more than 24$hours of labor in a day. This represents the theoretical limit to the flow of labor services (velocity). We argue this limit is analogous to the speed of light. The development of the analogy continues using hyperbolic functions independent of the demand frame of reference (frame of reference) and dependent on the degree of demand (rapidity) as well as the wage inelasticity (mass). This analogy describes the behavior of an individual laborer, detailing the quantity of labor services (position) and their flow, the wage (momentum) and the causation of changes in the flow of labor services (forces). These dynamics in labor economics are consistent with the theory of special relativity, demonstrating economic engineering principles.

Economic engineering is applied to model an individual laborer using the newly developed analogy. The laborer's supply curve shows that wage inelasticity does not change when a laborer performs more labor. Instead, the nonlinear supply curve is attributed to the difference in a laborer's perception of time (proper time). The perception of time depends on the flow of labor services of the observer, making it possible to observe the labor market from different perspectives, including those of companies and laborers. The laborer's perspective on their supply is visualized on the Poincaré disk, from which occupational compositions and job transitions can be analyzed.