The European Physical Journal B - Condensed Matter and Complex Systems

, Volume 2, Issue 4, pp 525–539

Stretched exponential distributions in nature and economy: “fat tails” with characteristic scales

Authors

  • J. Laherrère
    • 107 rue Louis Blériot
  • D. Sornette
    • Laboratoire de Physique de la Matière Condensée (CNRS UMR 6622)Université de Nice-Sophia Antipolis
Article

DOI: 10.1007/s100510050276

Cite this article as:
Laherrère, J. & Sornette, D. Eur. Phys. J. B (1998) 2: 525. doi:10.1007/s100510050276

Abstract:

To account quantitatively for many reported “natural” fat tail distributions in Nature and Economy, we propose the stretched exponential family as a complement to the often used power law distributions. It has many advantages, among which to be economical with only two adjustable parameters with clear physical interpretation. Furthermore, it derives from a simple and generic mechanism in terms of multiplicative processes. We show that stretched exponentials describe very well the distributions of radio and light emissions from galaxies, of US GOM OCS oilfield reserve sizes, of World, US and French agglomeration sizes, of country population sizes, of daily Forex US-Mark and Franc-Mark price variations, of Vostok (near the south pole) temperature variations over the last 400 000 years, of the Raup-Sepkoski's kill curve and of citations of the most cited physicists in the world. We also discuss its potential for the distribution of earthquake sizes and fault displacements. We suggest physical interpretations of the parameters and provide a short toolkit of the statistical properties of the stretched exponentials. We also provide a comparison with other distributions, such as the shifted linear fractal, the log-normal and the recently introduced parabolic fractal distributions.

PACS. 02.50.+r Probability theory, stochastic processes and statistics - 89.90.+n Other areas of general interest to physicists - 01.75.+m Science and society

Copyright information

© EDP Sciences, Springer-Verlag 1998