Students

Many decisions depend not only on what we want but also on what we expect others to do. Game theory studies these strategic situations, and one of its most important concepts is the Nash equilibrium, a state where each person chooses their best strategy assuming everyone else does the same. A classic example is the Prisoner’s Dilemma, where two suspects can either cooperate by staying silent or betray each other. If both cooperate, they get a light sentence; if both betray, they receive a moderate sentence; and if one betrays while the other stays silent, the betrayer goes free while the silent one gets the harshest penalty. Even though cooperation is best collectively, both usually betray to avoid the worst outcome, creating a stable but suboptimal result. This illustrates how rational choices can lead to predictable patterns, a concept we observe in many areas, including markets, politics, and social media. To understand this better, we first need to explore exactly what a Nash equilibrium is.

Have you ever watched a tweet go viral and wondered if someone is quietly making money from it? That idea is at the core of “Twitter trading”: turning tweets into data that guide trades.

We econometricians share the stage of ‘’metrics’’ with a lot of other disciplines. Think of biometrics, which deals with data concerning fingerprints, DNA, face recognition and more. Or even psychometrics, whose aim is to measure psychological features such as intelligence or other personality traits. A well-known personality test is the Myers-Briggs Type Indicator. But have you ever heard of cliometrics? This science is the application of ‘’metrics’’ to the past. 

What happens when Adam Smith meets Isaac Newton? Chaos, but with better equations. When the invisible hand meets the laws of motion, economics starts looking a lot like physics. In this crossover, an agent becomes a particle, energy becomes money, temperature becomes uncertainty, and trade becomes energy exchange. The result? Income distributions that behave like thermodynamic equilibria — and a new field people call econophysics.